samchain/econo-pairs-v1 huggingface dataset:
However, monetary policy can dampen the impact on output and employment in a transitional period. Chart: Labour costs relative to trading partners The policy rate has been cut and the interest rate differential between Norway and other countries reduced. Lower interest rates stimulate consumption and investment. The krone has depreciated markedly and has recently been at historically low levels. The depreciation of the krone is contributing to underpinning inflation and dampening the effects of lower oil prices on output and employment. Even though the cost level in Norway is still high compared with other countries, a weaker krone is strengthening the competitiveness of Norwegian firms exposed to international competition. At the same time, wage growth in Norway has moderated, and there are prospects that real wage growth in 2015 will be at its lowest in 20 years. Norway is therefore in a sound position to tackle the restructuring facing the economy. Conclusion The monetary policy instrument employed by Norges Bank is the key policy rate. With a wellfunctioning money and credit market, changes in the key policy rate will normally be transmitted to short-term and long-term rates. In recent years, a number of our trading partners have employed unconventional instruments to achieve a sufficiently expansionary monetary policy. This is not under consideration in Norway. We still have room for manoeuvre in economic policy. Based on our current assessment of the outlook for the Norwegian economy, there is little likelihood of a negative key policy rate in Norway. BIS central bankers’ speeches  9

It is actually on a flatter slope than it was in the 1990s and that of other emerging economies  4  BIS central bankers’ speeches  that have adopted measures to control capital inflows (figure 12). Still, it is important to be on the watch for excess flows that might incubate financial fragilities and exacerbate economic cycles, in which case it could be necessary to review financial regulations in place to avert any costly imbalances. Recent monetary policy decisions The scenario outlined in the latest Monetary Policy Report assumes that in the coming quarters the Chilean economy will grow in line with its potential. This will allow trend inflation, today in bounded levels, to converge and remain around the 3% target in the coming quarters. To achieve this objective, we have withdrawn some monetary stimulus, bringing the monetary policy interest rate (MPR) closer to the neutral range. Although this is the baseline scenario, the Report also indicated that inflation (and growth) risks were biased upward. For inflation, arguments were based on the combination of adverse supply shocks in energy and foodstuffs, the closing of output gaps and the strong dynamism of the domestic demand. Some of the aforesaid risks have eased. Private inflation expectations have moderated, consistently with MPR adjustments and the recent decline in oil prices and other commodities (figure 13). Anyway, commodity markets remain volatile, so it is premature to evaluate at what level international prices will settle.
Sukhdave Singh: Global RMB – challenges and implications Keynote speech by Dr Sukhdave Singh, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the HSBC Forum: China Globalising: RMB Rising (Malaysia) – “Global RMB: Challenges and Implications”, Kuala Lumpur, 12 August 2014. *  *  *  It is an honour and pleasure to be here with you this morning to talk about what is likely to be the most important development affecting the global monetary system since the introduction of euro. Should the RMB become a global currency, it will transform the global financial landscape. In fact, the RMB could potentially define this century, in the same manner that the US dollar dominated the previous century. In my remarks today, I would like to share some thoughts on the potential for the RMB to achieve the status of a global currency. Where it to do so, what will the potential impact be on the global monetary system? Finally, I will touch on the implications for Malaysia. The world is ready, is China ready? From where we stand today, the world is clearly ready for a global RMB. The question is whether China itself is ready. There is no question that the RMB would become an international currency. The only question is how big of an international currency. Will the RMB’s role in the international trade and finance reflect the status of China as the second largest, and soon to be the largest, economy in the world?

However, a large part of these outflows have been official and they have not been in RMB. This in fact touches at the heart of what is known as the Triffin Dilemma. China has been sending USDs abroad because that is what it has been receiving through its current account surpluses and FDI inflows. Sometime in the future, China may develop a structural current account deficit, but I do not see that happening in the foreseeable future. Opening up the capital account and domestic financial system to non-resident investors could lead to even more foreign currency capital inflows. On both accounts, China will not only continue to export USD capital but could find itself confronted by persistent appreciating pressure on its exchange rate due to the high demand for RMB. Promoting RMB for trade settlement will only go so far in resolving this. If more of China’s trade is settled in RMB, less USD will flow in, and China would need to intervene less and would have less USD to send abroad. But the question remains, with more RMB flowing in through the current and capital account, how do you get more RMB out of China in the first place? There are in fact numerous possibilities for China to create a significant pool of RMB liquidity abroad without necessarily running a current account deficit.
Stefan Ingves: The crisis in the Baltic – the Riksbank’s measures, assessments and lessons learned Speech by Mr Stefan Ingves, Governor of the Sveriges Riskbank, to the Riksdag Committee on Finance, Stockholm, 2 February 2010. *  *  *  The crisis in the Baltic – the Riksbank’s measures, assessments and lessons learned It is not possible to provide a comprehensive reply to all of the questions discussed in connection with the crisis in the Baltic in the space of 15 minutes. I shall therefore give a brief summary of the assessments made by the Riksbank during the course of the crisis and something about the measures we have taken. In conclusion, I shall say a few words about the lessons that can be learned. Before I discuss the role of the Riksbank, I would like to point out that the responsibility for developments in the Baltic countries primarily lies with their own governments with regard to economic policy, and with the banks, which have a responsibility for understanding developments in the economy and taking sustainable, long-term action. People often seem to forget in the general debate that we are talking about three different countries here. Financial market participants also tend to see the Baltic countries as a unit, which makes it difficult to manage the crises in these countries. Of course there are many similarities between the countries, for instance, their economic expansion and decline. However, there are also important differences.

Perhaps they must be based on a clearer interpretation of our mandate in the Sveriges Riksbank Act which currently states that we shall “promote stability in the payment system”. Perhaps we need to use more formal measures to a greater extent, such as expressing our recommendations in letters to the parties concerned. Regardless of the importance of clarity, it is always a sensitive issue to determine at what point the Riksbank can issue warnings regarding weaknesses in the financial system. This is of course even more difficult when it refers to another country. The Riksbank therefore also works through non-public contacts with other authorities in Sweden and abroad, with international organisations and with the Swedish banks. It is important to achieve consensus on the problems and possible measures. Of course, it is also very important to make our views public to put pressure on those concerned and to inform a broader public. – The Riksbank’s basic outlook is that we shall be as open and clear as possible. One lesson learned from both the global crisis and that in the Baltic countries is that the regulation and supervision of the financial sector must be strengthened. This entails, for instance, more and better capital in the banks, stricter requirements regarding the banks’ liquidity and risk management in general, as well as stricter supervision of large, crossborder bank groups.
First, if the affected institution provides services that are of crucial importance to the national economy and which are generally indispensable. Second, if these services cannot be provided by other market participants at short notice – in other words, they are not substitutable. How pronounced are these two aspects in the banking sector? First, banks generally provide a wide range of essential services for the economy, such as lending or payment services. Second, these services are not easily substitutable, particularly at big banks. Banks are closely interconnected with each other, and with the rest of the economy. The result is that problems at one bank can spill over to other banks and the rest of the economy. The larger the bank and the higher its market share, the smaller the likelihood that other market participants will be able take over important functions at short notice in the event of a crisis. Thus, a bank’s size and market position are important indicators for assessing its systemic importance. Specific parameters are the bank’s share of domestic lending and deposit business, and its importance for payment transactions. Another widely used measure of systemic importance is the ratio of balance sheet total to GDP, as this is a good indicator of the bank’s interconnectedness and the (lack of) substitutability of its services.

The mere assumption that a bank is too big to fail can be a self-fulfilling prophecy. 4 On the assumption that it will be bailed out if necessary, the bank may take on excessive risk much more readily, and focus its business model too heavily on debt-based growth. Thus, the bank becomes even bigger, thereby increasing the likelihood that the state will have to intervene in a crisis, so that the original assumption proves to be correct. Given this increased likelihood of a bail-out, the bank can now take on even more risk, and the de facto bail-out obligation becomes even more acute – a vicious circle. This bail-out obligation can result in very high and unforeseen costs to the state. The scale of these costs was highlighted by the global financial crisis, which at the time saw announced  2 3 4  For example, cf. International Monetary Fund (2014) for an estimate of the magnitude of this subsidy. Cf. Afonso et al. (2014). Cf. Alessandri and Haldane (2009). Page 4/14  state support for the financial sector in advanced economies amounting to some 20% of GDP (cf. slide 2). 5 State budgets, which are already under strong pressure from the recession associated with a financial crisis, can be overstretched by the cost of state support measures. And indeed, during the crisis, a number of countries did find themselves having to shoulder costs well in excess of their financial capacities. Ultimately, they coped by resorting to external support.
The reform measures in the Payment Card Reform Framework (PCRF) implemented since 2015 have enhanced transparency and competition, bringing about a continued decline in the average merchant discount rates (or MDR). Merchants have benefited from lower cost of accepting card payments, with an estimated cost savings of about RM422.4 million from 2015 to September this year. Consequently, the annual growth of POS terminals has more than doubled from about 6.8% for the period between 2011 and 2014, to 17% for the period between 2015 and 2017. Key trends shaping our payment landscape today Since the Payment Forum in 2015, many developments have taken place in the payment landscape both domestically and internationally. Firstly, society has become increasingly digital and connected, driven by the Internet and mobile revolution. For a population of 32.1 million in Malaysia, there are 42.8 million mobile phone subscriptions while smartphone penetration stands at 70% and is increasing. Secondly, payment technology has become more advanced, scalable and increasingly low-cost. For instance, innovations in the area of merchant acceptance has lowered the cost for merchants to embrace electronic payments through the use of Quick Response (QR) codes. Likewise, the advancements in biometric and tokenisation technologies and the shift towards greater publication of Application Programming Interfaces have enhanced the ability of payment service providers to develop new use cases and deliver superior customer experience. Thirdly, the market players in our payment landscape have become more abundant, diverse and increasingly non-traditional.

I also wish that our commitment to achieve future success of the industry as reflected in this event by the joint efforts and collaboration of the regulators, the industry, the market participants and the relevant parties will be further enhanced moving forward. In this regard, I would again congratulate AIBIM on its continuous effort undertake the initiatives in promoting Islamic finance, particularly by organizing this event. 2  BIS Review 115/2006  On this note, I wish you a successful and eventful week. Dengan lafaz Bismillahirrahmanirrahim, saya dengan sukacitanya merasmikan pelancaran "Kuala Lumpur International Islamic Financial Expo 2006". Thank you. BIS Review 115/2006  3
But in order to compete well, you will have to be well capitalized, well organized with good governance and risk management processes. Number two, you can help establish market codes and practices that conform to world standards. The market needs rules to ensure smooth trades and dispute resolutions, and to guard against manipulation. The industry has an important role to play in the setting of rules and codes of conduct. Number three, you can help ensure that the market has a wide variety of products. We should aim for a market that can offer many kinds of contract, to serve those needing to unbundled or rearrange all kinds of risks at competitive prices. And lastly, you can build for yourselves a good analytical capability. It will prevent herd behavior, and help to stabilize the market. But more importantly, proper project analysis can ensure that capital is channeled only to the good projects. It can help prevent over expansion of businesses, over diversification and over enthusiasm that inevitably winds up as non-performing loans in the end. Ladies and gentlemen The task of the central bank in monetary policy is to ensure that it sets the right policy, and that its policy is transmitted through to the overall economy. The financial system through which their policy is transmitted must also be safe and sound. Non-bank financial institutions do indeed have vital roles to play here. BIS Review 48/2002  3

5  Source: St.meld. 39 (1993-94). 6  Source: For Sweden: Jennergren and Näslund (1998). For Norway: Norges Bank, Moen (2003). 7  See Hoggarth, Reis and Saporta (2002). 8  Peek and Rosengren (2000) look at the loan supply shock facing U.S. firms borrowing from Japanese banks during the banking crisis in Japan. They identify a substantial impact on U.S. real estate activity from this supply shock. 9  See Ongena, Smith and Michalsen (2003) and Vale (2002). 4  BIS Review 58/2003  good advice, but there is a delicate balance between restoring private ownership quickly and trying to recover as much as possible of the government’s fiscal costs. The Norwegian banking crisis was handled swiftly and transparently and at relatively low cost to the taxpayers. Furthermore, the banks that came out of the crisis had trimmed their operating costs and established much better systems to evaluate credit risks. In one respect, we were rather lucky compared to others. The crisis built up gradually, so there was time to assess the situation and strengthen the defences of the financial system before the crisis became systemic. The banks’ equity capital provided the first line of defence and the banks’ collective guarantee funds the second when bank losses started to soar. The third line of defence - the Government Bank Insurance Fund - was only established when it was evident that the first and second lines of defence did not hold, but it was nevertheless established in time.
The Central Bank incorporated these expectations into its baseline forecast, even though it considered them unrealistic. They assumed rapid cuts in the policy rate commencing early this year. The Central Bank considered neither assumption to be compatible with the inflation outlook. Thus the forecast lacked credibility, in the Bank’s own opinion. This prompts the question of what assumptions it is natural for the Central Bank to make about the policy rate in its baseline macroeconomic and inflation forecasts. Iceland is not the only country whose central bank has faced such a challenge. Several years ago, the Reserve Bank of New Zealand responded by using its own policy rate forecast as an assumption. The Bank of Norway followed suit two years ago and now uses a future interest rate path forecast by its Executive Board for its baseline forecast. Sweden’s Riksbank recently announced that it will use its own forecast for the repo rate path as an assumption in its inflation forecast. These banks have followed a similar course to the Central Bank of Iceland in developing the interest rate assumptions behind their forecasts. They have now opted to use the path that is forecast by those who actually determine the policy rate, partly because they did not consider market agents’ forecasts and expectations sufficiently credible. At the same time, these central banks have firmly stated that their policy rate forecasts entail no commitment to hold their rates to that path.

It would, as many in this audience know, have major implications for the way we transact with each other and, more broadly, for the financial sector and the economy in general. The Taskforce’s conclusion is that we are not yet at a point where a firm decision can be made to implement a digital pound. However, in view of the likely need and the lead time to introduction, the Bank and The Treasury, will now proceed to the next stage of detailed policy and technical development of the digital pound - including the development of a technical blueprint. This stage will take around two to three years following which a decision will be made whether or not to proceed to the next stage and implement a digital pound in the UK. The work over the next two to three years will inform that decision and will reduce the lead time to launch should the decision at the end of this stage be to implement the digital pound in the UK, which could then be introduced in the second half of the decade. In this next stage of detailed policy and technical work, including the development of a technical blueprint for the chosen model of the digital pound, we will work closely with private sector partners on proofs of concept, experimentation as well as on the development of the blueprint  Page 3  itself.
In fact, a CBDC's potential contribution to boosting the strategic autonomy of the European Union, by offering a fast and efficient alternative to other payment providers, is one of the key reasons why the Eurosystem is assessing the issuance of a digital euro. But it is not the only one. The role of the euro as monetary anchor is not only being put to the test by these new developments, but also, and probably more importantly, by the natural evolution of society. The increasing digitalisation of every aspect of our daily lives is reducing the use of cash as a means of payment. Should it reach the point where cash is hardly used, the convertibility of central bank money and private money would be put at risk, affecting people's confidence in the latter. We believe that having a digital euro to ensure convertibility between these two types of money would underpin and protect the integrity of the euro as a unit of account. A digital euro could also foster innovation, increase the efficiency of payments, and reduce our current reliance on non-European payment solutions and technologies. I think the benefits of issuing digital central bank money for retail use are clear, but we cannot forget the other side of the coin. CBDCs come, indeed, with a number of challenges. The technical or operational ones, such as setting up a whole new payment infrastructure, giving digital access to central bank money to every citizen and delving into the intricacies of retail payments are obvious difficulties to surmount.

The average price difference is 16 per cent,  BIS Review 92/2001  1  which means that the difference is approximately 40 per cent larger than is the case between various states and regions in the USA. The price of a normal Volvo, for instance, can differ by 15 per cent or more from one country to another in Europe. Some of this difference is created by difference in cultures and languages, but new studies indicate that the actual psychological barrier involved in differing units of currency may bear a large part of the responsibility. The US economist Charles Engel, for instance, has calculated in extensive studies of price differences between the USA and Canada that a currency border creates price differences corresponding to a geographical distance of almost 8,000 km, even if the countries on either side of the currency border (as in the case of Canada and the USA) are entirely open to one another and share the same language and culture. The largest negative effects of having different currencies probably have to do with trade and resource allocation. In the same way that we believe inflation results in large national economical costs by creating uncertainty about future expenses and income, a fluctuating exchange rate does too. In addition, the allocation of resources in society is distorted by an exchange rate that is not fully motivated. The EMU has particular significance for trade.