samchain/econo-pairs-v1 huggingface dataset:
In this regard, ASEAN members have agreed to prioritise efforts to liberalise the cross-border supply of Marine, Aviation and Goods in International Transit (MAT) insurance and to support the establishment of an ASEAN Disaster Risk Financing and Insurance (DRFI) mechanism. Progress in these areas will enable ASEAN members to increase capacity for such risks which are growing in scale and complexity, and achieve broader diversification of risks across the region, leading to lower costs of insurance. It will also enhance the protection of ASEAN communities and economies against increasing exposures to catastrophes. Significant progress has also been made in promoting freer flow of capital and greater connectivity between the ASEAN capital markets through the various initiatives and measures by the ASEAN Capital Markets Forum. Market participants can look forward to more seamless cross-border investments with reduced costs and greater access to ASEAN investments. Financial integration initiatives are also focusing on harmonising further the operating environments for payment systems within ASEAN countries. A key outcome is to create an efficient, reliable and secure payment and settlement system which is able to operate smoothly across ASEAN. Consumer transactions such as cash withdrawals and payments for goods and services will be further simplified, contributing towards the growth of retail businesses in ASEAN economies. The development of more convenient and cost effective retail payment systems can also help realise the full potential for e-commerce in ASEAN. Efforts are also underway to promote the use of ASEAN currencies for trade settlement.

Forward guidance gave households and businesses confidence that Bank Rate would not be raised at least until jobs, incomes and spending were growing at sustainable rates. Guidance encouraged businesses to hire and spend, and helped keep expected interest rates low, even as the economy recovered strongly. In parallel, we encouraged banks to continue repairing their balance sheets. Changes to the Bank’s liquidity policy further supported lending. The core of the financial system is now on a sound footing and making an increasingly important contribution to the recovery. We are now faced with the challenge of turning that recovery, which has steadily gained momentum and breadth over the past year, into a durable expansion. To do so, we need balance. Its absence can have serious consequences. One has only to look back to 1931 when Britain’s economic prospects were strained by high unemployment, a large budget deficit and a deteriorating balance of payments. In the ensuing crisis sterling was forced off the gold standard and the government of the day resigned. BIS central bankers’ speeches  1  And the Governor? With the uncanny foresight of a central banker, Montagu Norman had already left the scene “to get a bit of rest [in Quebec]”, he said, “for I have had a very hard time of it lately and I have not been so well as I would like to be.”1 However tempting, I will lean on Canada not for restoration but for a nautical analogy to describe how we can address the challenges we now face.
Is it possible to complement or modernise the framework to reduce known vulnerabilities while enabling investments that boost long-run potential growth and prosperity, and help alleviate some of the supply-side problems4 that contribute to high inflation? To give us a good foundation to start from, I would like to begin by briefly summarising what happened in the 1990s and how the economy has changed since then. 3 The Riksbank has for a long time been pointing out the risks associated with rising indebtedness; see, for exam-  ple, Ingves (2015). 4 For example, a lack of investments in the electricity grid cause a divergence of electricity prices across different regions of Sweden. Note that there is a big difference between long-term investments that improve the functioning of the economy and strengthen supply side, which dampens inflation, and discretionary fiscal policy that can temporarily support households and businesses but risks increasing inflation. 2 [16]  Drama thirty years ago We are living in dramatic times: A recent pandemic, war in Ukraine and inflation that has risen sharply around the world. One similarity between then and now is the major geopolitical drama. Then, there were revolutionary events such as the reunification of Germany in October 1990, the Kuwait war, the wars in former Yugoslavia which started in 1991, and the dissolution of the Soviet Union in December of the same year. The political events made their mark on economic developments. I have often thought of the 1990s crisis as a domestic financial crisis.

Furthermore, companies are financing themselves much more often in the market today, by issuing certificates and bonds. Thirty years ago, most of them borrowed from banks. Changes in financial markets can affect the transmission of monetary policy, which we need to take into account in our monetary policy assessments. Diagram 9. Borrowing among non-financial corporates Percentage of GDP, quarterly data 100 80 60  40 20 0 1990  1995  2000  2005  2010  2015  2020  Loans from monetary financial institutions Securities borrowing  Note. Includes securities borrowing in both Swedish kronor and foreign currency. Sources: Statistics Sweden and the Riksbank. In short, the development of the Swedish economy over the past 30 years may be summarised as good on the real economic side, but with some worrying signs on the financial side. 12 [16]  Forward planning difficult but important I would like to broaden the perspective a little. Thirty years ago, Swedish economists and politicians alike agreed that a steadfast defence of the fixed exchange rate was the only way to break with the weak development of the Swedish economy and lead it onto a new path. Many in Sweden were stuck in a particular way of thinking, a paradigm, where we did not realise that economic reality had changed so much that our frameworks also needed to be fundamentally changed. With free capital movement, a deregulated credit market and a poorly functioning economy, the fixed exchange rate was not a good instrument for creating economic stability and prosperity.
In an environment like the present one, characterised by the extreme sensitivity of economic agents to economies’ fiscal situation, in particular in the euro area, any other strategy that might jeopardise the  4  BIS central bankers’ speeches  achievement of the fiscal targets in the terms established would have very negative consequences for market confidence in the Spanish economy, seriously damaging its growth possibilities both in the short and in the medium and long term. By contrast, strict compliance with the commitments made may generate a virtuous circle of improvements in confidence and expectations that is conducive to the recovery. The 2012 Budget for the State and the Social Security system, along with the budgets of the regional and local governments, are the first link in this strategic chain. It is vital that these budgets be fully consistent with achievement of the target set for the budget deficit of 5.3% of GDP this year, down from 8.5% of GDP in 2011. This reduction in the budget deficit requires an unprecedented adjustment in the primary structural deficit, since it must offset the expected increase in the interest burden and the effect that the fall in economic activity is forecast to have on public finances. The draft State Budget for 2012 details the measures proposed to meet targets in the case of the State and the Social Security system, distributing the adjustment on both the public revenue and expenditure sides.

In 2016, the Executive Board’s capacity was strengthened by the appointment of a second deputy governor and an increase in the number of board members. At the end of 2016, the cumulative value of transfers to the GPFG was approximately equal to the cumulative return on the fund, reflecting the fund’s solid performance over time. Last year, the return on the GPFG was 6.9 percent.1 Over the period since inception, the return has averaged 5.7 percent. Adjusting for inflation and management costs, this gives an average real return of 3.8 percent. Developments in international financial markets and the growth outlook for the global economy suggest that the expected real return ahead will be somewhat lower than has been the case in recent years. The GPFG closely tracks the benchmark index; it is invested across a broad range of countries and markets. This strategy has so far generated a solid return within the defined risk limits. Restrictions imposed on the fund’s scope for investment, or instructions that disregard the tradeoff between return and risk, will limit the fund’s potential to achieve solid performance over time. In the execution of our management assignment, it is important that Norges Bank’s role is that of financial investor. It is crucial to the GPFG’s reputation in investee countries that the fund is not perceived as a political instrument. Norges Bank aims to be at the forefront of global efforts in the area of responsible investment.
It is often difficult to distinguish between what is monetary policy and what is  8 [25]  financial stability policy, both in purely practical terms in the current situation, and on a more theoretical level. 8  Central banks supported market functioning The next group of problems is related to market functioning. Some markets for important securities can become so uncertain during a severe crisis that no private investor is prepared to buy these assets. Or else the uncertainty on the financial markets can lead to severe fluctuations in the compensation the financial agents require to invest in risky assets (risk premiums). This could in turn threaten the monetary policy transmission mechanism. This type of problem affected the very important US housing bonds during the financial crisis. To avoid a substantial credit crunch for US households, this market needed to keep functioning. During one period, therefore, the Federal Reserve purchased a very large share of the newly issued housing bonds, which had the desired effect – the market stabilised. Sometimes all it takes is for the central bank to make it clear that it will act if problems arise. The actual signal may then be enough to calm the market. Sometimes a facility will do the job. If the market is worried it will be difficult to temporarily convert an asset into liquidity on private markets (for instance through repos), the central bank’s facility may be sufficient to calm the situation.

In some countries, citizens have become indebted through the state – a national debt of more than 100 per cent of GDP is beginning to be common. In other countries, such as Sweden, the national debt is low, but instead private indebtedness is high. A large part of this development can be explained by lower interest rates. Households’ interest expenditure as a share of their incomes is not so much higher now than before, despite the large rise in debts. The debts have mainly been used to finance housing purchases, and, as the supply of housing has been relatively sluggish (although construction has been high in recent years), housing prices have risen substantially. But if we can explain part of the increase with low interest rates, does this mean it is not a problem? No, I don't think so. A high level of indebtedness leads to large risks – if interest rates rise, then households will have a much higher interest burden. 6 [25]  Monetary policy is conducted to attain an inflation rate close to the target and stable resource utilisation. The problem is that monetary policy has an impact through several different channels, including households’ consumption decisions, the exchange rate and investment. Monetary policy that is well balanced on the basis of inflation and resource utilisation in the economy as a whole can be problematic for a group of households that is highly indebted. In this situation, it is important that the banks and Finansinspektionen ensure that credit granting is sustainable.
Indeed, a noteworthy addition to the MPC’s remit when it was renewed by the Chancellor earlier this year was a request that “… the Committee should promote understanding of the trade-offs in setting monetary policy to meet a forward-looking inflation target while giving due considerations to output volatility.” The forward guidance announced by the Committee clarifies its view of the appropriate trade-off. The primacy of the inflation target makes clear that the long-run objective for monetary policy hasn’t changed, and the inflation forecast knockout provides information about the minimum speed at which the Committee judges it acceptable to bring inflation back to target. At the same time, the unemployment threshold provides guidance about what the MPC is trying to achieve in terms of real activity as the economy gradually normalises. Moreover, by making clear its view of the desired trade-off, the MPC helps to make our monetary policy more predictable. This enables financial markets, companies and families alike to make more informed decisions and so improve the effectiveness of policy. Let me summarise where we have got to so far. The inflation target served us well during the financial crisis. Straight A’s for preserving credibility and for anchoring inflation expectations. But the aftermath of the crisis has posed particular challenges of communication and accountability that, on its own, an inflation target is ill equipped to address. The MPC’s forward guidance is designed to help us to meet those challenges head on.

- For the economy: this process increases the country’s economic and financial stability and creates premises for a simpler tax system and a fairer distribution of the tax burden. Thank You! 2/2  BIS central bankers' speeches
In the light of the trajectory of recent decades, what can we say about the future of the Spanish economy in the medium and long term? To tackle the future from a useful perspective, I shall follow Epictetus’s recommendation for gaining knowledge of the world. The stoic philosopher divided worldly matters into two: those that depend on us and those that do not. This classification is useful because, when talking about the future of the economy, it is worth focusing on those things that depend on the behaviour of economic agents and all those who intervene in framing economic, regulatory or supervisory policies, without wasting time regretting what we cannot change or influence. Among the things beyond our control is, for example, the external environment, including the European economy which is so important for Spain, since our influence on developments in the rest of the world is very limited. It is also important to realise that the starting position of the Spanish economy with its strengths and weaknesses, which is the basis for predicting its short-term trajectory, is a given and we can do nothing to change it. As indicated at the start of my address, I do not wish today to dedicate my time or yours to analysing the economic situation or predicting the course of the economy in the coming months. Rather, I shall focus on those determinants of the future of the Spanish economy in the medium and long run that really depend on the behaviour of all economic agents.

Miguel Fernández Ordóñez: The biggest risk - complacency Address by Mr Miguel Fernández Ordóñez, Governor of the Bank of Spain, delivered to the Círculo de Economía, Barcelona, 31 January 2007. * * * I very much appreciate the opportunity provided to me by the Círculo de Economía to deliver this address at this time, just as the figures for last year have been released. In terms of the Spanish economy's performance, the figures speak for themselves and confirm a favourable short-term outlook. Against this background, I think it is very important to reflect on the underpinnings of the economy’s trajectory, in order to identify those factors that are genuinely relevant for projecting ahead the progress that has been achieved in recent decades. I have therefore thought it best to adopt a long-term approach for this speech, going beyond conjunctural analysis. And with the title I have chosen, I have sought precisely to stress that when things are going well and the outlook is favourable, the biggest risk is complacency. The year 2006 ended in Spain with growth at around 3.8%, outperforming the seven biggest industrialised countries. This is the first time in many years that this has happened. Not only has growth in Spain been higher than in the euro area countries, but it has also been higher than in the United Kingdom, Japan and the United States, which in recent years had been growing at a rate above Spain.
TLAC and MREL are comprised of debt-instruments and equity. The key point here is that this important reform requires a very clear distinction among debt contracts between forms of subordinated debt contracts which will bear losses in resolution first and deposit and other senior funding contracts on the liabilities side of the bank balance sheet. This may seem like a very simple point, but past arrangements meant it was unclear, and the moral of the painful story is “don’t leave the providers of debt funding in any doubt about their creditor status.” The lack of clarity about the instruments on the liabilities side of bank balance sheets and the order and mechanisms by which they would absorb losses was an important issue in the crisis. Looking ahead, clear disclosure of creditor hierarchies at a legal entity level will be a critical component of the resolution regime, so that all creditors know where they stand before resolution occurs. Let’s turn now to the other side of a bank’s balance sheet, the assets side. The massive increase in balance sheet size pre-crisis accompanied what came to be known as the “search for yield”, which could be re-named the “search for risk which turns out to be unsustainable”.

On the banking, as opposed to trading book side of the assets of major banks, the search for yield often took the form of loans which included too much equity-like  2  BIS central bankers’ speeches  risk because the equity stakes of the owners of the companies were too small. This was not equities themselves, but rather equity components embedded in loans. Commercial property lending in the UK is a good example, as it was in Ireland. Commercial property prices in the UK have over time tended to vary more than, say, prime residential house prices and that points to a need for larger equity-like component of funding to absorb losses from that variability. The search for yield however meant that banks were more happy to lend against equity risk of this sort. Since the crisis in the UK we have seen a shift in commercial property finance towards a larger share coming from funds which explicitly take this equity-like risk. This strikes me as a good thing in terms of reducing the exposure to such risks of banks, whose liabilities tend more to be in the form of deposits. I sometimes hear comments that banks are losing the race to new innovations such as peerto-peer lending for the supply of what I would describe as finance with a heavy equity component.
The result is that, on average, between 40% and 60% of an idiosyncratic shock to a euro area country translates directly into a decline in its consumption, twice the analogous impact estimated for the United States. Against this background, the Capital Markets Union, which aims at providing firms and households with identical funding and saving opportunities, irrespective of their location, remains an essential initiative. The Capital Markets Union project has focused on several initiatives (or operational objectives). These aim to improve information flows in order to facilitate price discovery; to allow better access to new markets and products; and to achieve a stronger enforcement  13  of rules and procedures in order to increase legal certainty and investor protection. Progress has been fruitful in some areas, but much remains to be done. In general, the project garners broad support from all parties concerned, but it currently lacks much-needed momentum. As indicated in the conclusions of the Report by the Next CMU High Level Group in October last year, the sheer breadth of the project and the multiple dimensions involved require the identification of a large number of specific actions, aiming to enhance supervisory and regulatory harmonisation, which must be promoted and implemented at the national and supranational level. Finally, the creation of a common safe asset for the euro area may be the cornerstone of a common capital market, with important implications for other policy areas 2. A wellfunctioning capital market requires a broad asset class with ample liquidity and low risk.

Ladies and gentlemen, An important transformation in the international financial landscape is the introduction of the euro which has indeed been a defining event. The objective was clearly to facilitate trade and investment within the region by removing the distortions in economic relationships introduced by exchange rate volatility. As a result, where there were previously 12 currencies, there is now only one. Corporations dealing with the 12 euro countries are now able to keep their books in one set of accounts and make operating and investment decisions without having to be concerned about exchange rate changes. For the rest of the world, it has been described as “island of price stability” in addition to the dollar area, to which capital can flow. Four factors are important in determining a currency's international role: relative stability, which would reduce the risk of holding assets in that currency; a strong exchange rate; so that capital losses can be avoided; deep and liquid financial markets for that currency, to enable holders to diversify, liquidate and adjust their investment portfolios; and finally, a strong regulatory support to minimise the possibility of crises. Indeed, the international success of the euro in coming years would depend on the extent to which these criteria are met. The introduction of the euro has of course given impetus to other regional initiatives to pursue similar efforts to unify national currencies into a single regional currency. Such initiatives are being pursued in Latin America, Africa and the Middle East.