samchain/econo-pairs-v1 huggingface dataset:
The blue line in the chart shows that GDP growth was markedly higher than trend growth in the latter half of the 1990s and in the period from 2003 to 2008, but that it has risen somewhat more slowly in the period following the financial crisis. When developments in output are compared with inflation, a pattern emerges. A pickup in GDP growth has consistently occurred 4–5 quarters before a rise in inflation.5 While the chart says nothing about causality, turning points in GDP growth seem to be a fairly reliable leading indicator of turning points in inflation. The path from changes in output to inflation passes through the labour market, among others. We have seen that when economic growth has picked up, unemployment6 has declined one to two quarters thereafter. The relationship between the “output gap” and the “unemployment gap” is fairly strong. This is a useful observation because GDP figures are published with a considerable lag and often subject to revision, while the unemployment data published at the end of each month are not revised. If there is uncertainty about the GDP figures – which there often may be – falling unemployment can be an indication of a recovery in economic growth. Labour market developments, in turn, affect wage growth, as illustrated by the blue line in the chart. High unemployment results in low wage growth, and vice versa. The chart shows that in periods of falling unemployment, wage growth7 moves up fairly rapidly.

The EU countries have established a joint fund to provide loans for countries with debt problems. The ECB has intervened with support purchases of government bonds. These measures are limited in scope and duration and are intended to be replaced by more permanent resolution mechanisms once they have been implemented. The political authorities may still, in time, find suitable and more permanent solutions, both in Europe and the US. But the road ahead may be both bumpy and long. The Norwegian economy is robust. Government finances are sound, banks are solid, unemployment is low and the economy is growing at a fairly solid pace. At the same time, we must acknowledge that we are influenced by turbulence and weaker prospects internationally. Norway is an open economy. Norwegian firms will be affected if demand slows or funding becomes more difficult. Monetary policy can respond rapidly to changes in the outlook, for example as reflected in Norges Bank’s decision to keep the key policy rate unchanged at the August monetary policy meeting. 14  BIS central bankers’ speeches  Earlier this week, the Swiss National Bank decided to announce a minimum exchange rate for the Swiss franc against the euro owing to the substantial appreciation of the Swiss franc. Interest rates and inflation in Switzerland are close to zero and growth is low. According to the Swiss National Bank, a further appreciation could have resulted in a recession with deflationary developments. Measures were therefore introduced to prevent such developments. The Norwegian krone appreciated sharply after the announcement.
For instance, the economy could suffer a major supply shock that led to prices of commodities, energy and foods rising or falling substantially. In these situations it might be reasonable to accept a longer deviation from the target than two years if the strain on the real economy would otherwise be unacceptably high. Let me summarise: The Riksbank has one objective for monetary policy and that is to maintain price stability. The Riksbank's method of working encompasses possibilities within this framework to take into account different aspects of interest rate decisions, such as fluctuations in the real economy. However, such considerations do not mean that we have specific targets for other quantities than inflation. A look back - inflation 2005 Finally, I intend to take a look back at developments in inflation over the past year. This is to follow the usual custom at the first hearing of the year and give an account of the outcome of the monetary policy conducted. As you know, inflation was low last year (diagram 6). For the second year in a row, the inflation rate was below the Riksbank's tolerance interval for inflation. UND1X inflation was 0.8 per cent and CPI was 0.5 per cent on average for the year. The forecasts of inflation made by the Riksbank in 2003 and 2004 anticipated that inflation would be much higher than that in 2005. Why was inflation surprisingly low? To begin with, one can observe that it was not due to a weak economic upturn.

This will ultimately enhance the liquidity of our markets. Recognising the potential benefits of establishing linkages, the ASEAN Finance Ministers have recently agreed to explore ways to forge alliances within the ASEAN securities markets. Forging successful exchange linkages is, however, not without its challenges. But these are not insurmountable. Let me briefly outline three of them. Firstly, exchanges’ technology and infrastructure will have to be updated and enhanced to cater to an increasingly integrated marketplace and a more sophisticated investor base. There is a need to ensure that the various IT infrastructures are interoperable and scalable, so as to allow partner exchanges to share common platforms and reap the benefits of economies of scale. Secondly, greater harmonisation of standards and regulatory requirements is a prerequisite for deeper linkages and alliances amongst the regional exchanges. Some regional exchanges and regulators have made a start by committing to work together under various MOUs. We should take the next step of looking at other initiatives to bring about greater convergence of standards in corporate governance, trading conventions, rules and regulations. Finally, the success of exchange linkages is highly dependent on investors’ interest in cross-border trades via the linkages. To achieve this, the linkages must provide a cost efficient solution for investors’ trading needs. There is also a need to cultivate Asian investors’ interest in cross-border investments. Asian investors’ investment portfolios traditionally reflect a strong home bias.
With tighter control over processes, information systems, operations and risk, French credit institutions should be able to cope with future developments  Aside from the cyclical aspects I have just mentioned, the short-term outlook is characterised by both the increasing interplay between the financial and non-financial spheres, owing to the development of new risk-transfer instruments, and by closer harmonisation of the rules applicable to different economic agents. 3.1  Careful attention must be paid to the characteristics and consequences of risk transfer transactions  Credit derivatives, and products and techniques like securitisation that produce similar results, are a means of reducing the loan-loss exposure of credit institutions, which are net risk-sellers. These instruments can be useful for mitigating risk exposure, provided naturally that banks act as protection buyers. However, the characteristics and consequences of the development of these products must be closely scrutinised, both by credit institutions operating in these markets and by the authorities responsible for maintaining financial stability. Institutions must pay particular attention to the real impact of risk transfer. They must also keep close watch on the resulting counterparty risk that attaches to the protection seller. The question of risk transfer is also under scrutiny because of the treatment of the special purpose vehicles to which assets are sold. On this point, the accounting rules currently under review at the international level seem to focus quite rightly on the reality of risk transfer. Credit institutions must therefore analyse this criterion in greater detail.

It is clear that the developments taking place in the financial sector now could impact how the Bank of England meets our mission to promote the good of the people by maintaining monetary and financial stability. But to assess this properly, we cannot operate in isolation. We welcome the Government’s Fintech 8  Sector Strategy, including the announcement of a Treasury/FCA/Bank of England taskforce – a key element of this Strategy, which will explore further the risks of crypto-assets and the potential benefits of the underlying distributed ledger technology. The Bank of England also needs to make sure its door remains open to engagement with the experts and innovators in the private sector too. Open doors 9  We have been doing this. Over the past two years the Bank of England’s award-winning Fintech Accelerator has worked with industry, experimenting with new technology and developing our understanding  4  Ramsden, D (2018) HM Treasury (2017) 6 Bank of England (2018) 7 Carney, M (2018) 8 HM Treasury (2018 ) 9 Central Banking Magazine ‘s Initiative of the Year (2018) 5  3  All speeches are available online at www.bankofengland.co.uk/speeches  3  in the process. We have carried out a number of proofs of concepts including those using distributed ledger 10  technology, RegTech, machine learning and cyber security .
As I have already said, any delays would postpone the achievement of the target. Moreover, the key rate that would be required for this purpose would be considerably higher. As regards the economy, I would like to stress that the majority of industries have already bounced back to the pre-pandemic level of output. Certain restrictions remain in a number of sectors, first of all in oil production where they are associated with the OPEC+ agreements. The services sector, where small and medium-sized enterprises account for a larger portion than in other industries, has not fully restored yet. The decline here was stronger and still persists, although the recovery process is quite active. Quarterly data on GDP for 2020 confirmed our estimates that business activity did not wane during the autumn wave of the pandemic, in contrast to many other countries. Furthermore, companies promptly responded to the recovery in demand, purchasing equipment, making investments in production expansion, and forming the inventories of raw products and components. Among other things, this is evidenced by the rise in investment imports over the last six months. Taking into account high-frequency indicators for the first quarter, we keep unchanged our GDP growth forecast for this year at 3–4%. As the reduction in GDP was slightly lower last year and demand has increased, the economy may generally reach pre-pandemic levels as early as in the second half of the year.

In a situation where these risks materialise, an increase in volatility in financial markets may speed up inflation, which we factor in when making our decisions. There are also disinflationary risks, yet the probability of their materialisation is lower and they are mostly associated with the fact that demand growth may turn out to be below our expectations. This group of risks may also include a faster reopening of borders, as a result of which demand may shift from domestic consumption to foreign travels. The risk of new coronavirus strains or lower paces of vaccination persists, which, in contrast, may reduce people’s mobility and limit consumption growth, especially in the services sector. If the situation develops not in line with our baseline scenario, we will be responding so as to bring inflation back close to its 4% target over the forecast horizon. Winding up, I would like to comment on the future path of the key rate. Today, we have first published the ranges of the average Bank of Russia key rate for a calendar year over the forecast horizon. According to our baseline forecast, this year the average key rate will generally equal 4.8–5.4% p.a., 5.3–6.3% p.a. next year, and 5–6% p.a. in 2023, which is in line with the range of the long-term neutral key rate. By publishing the path of the key rate, we increase the transparency of our communication, which will ultimately improve the efficiency of monetary policy. Thank you for your attention. 3/3  BIS central bankers' speeches
In multilateral terms, the appreciation has also been smaller, because of the dollar’s loss in value with respect to other currencies; even some currencies of Chile’s trading partners have shown higher bilateral appreciations than the peso (figure 10). Among the long-lasting elements underlying this appreciation, we may highlight improved terms of trade, a better cyclical position of the Chilean economy compared with developed ones, the accumulated increase in the ratio of public expenditure to GDP and the reduction in our net debtor position relative to the rest of the world. In Chile, net capital flows have been limited. We have seen capital inflows as direct foreign investment and placement of bonds abroad by Chilean firms. But at the same time, these inflows have been offset by outflows due to higher investments abroad by residents, including pension funds. Considering the level of the nominal exchange rate and currency parities prevailing at the statistical closing of this IPoM, the real exchange rate (RER) is around its minimum consistent with its long-term fundamentals. The baseline scenario of this IPoM uses as a working assumption that the peso will post a moderate real depreciation into the long-term. Projections also use the assumption that the monetary stimulus will continue to be gradually withdrawn at a pace comparable to what can be inferred from the various expectations surveys (figure 11). The Board hereby states that this will depend, in any case, on the unfolding of domestic and external macroeconomic conditions.

Chart: Changes in employment So far, however, it is only in the tourist industry where a weaker krone has led to clearly higher activity. Since oil prices started falling in autumn 2014, employment has shown solid growth in the hotel and restaurant industry, but otherwise almost two in three new jobs have come in the public sector and the construction industry. Growth in those sectors has offset the decline in oilrelated industries, where one in five jobs has been lost. The strong growth in jobs in the construction industry reflects the economic policy pursued. Public investment has increased, and low interest rates have fuelled house price inflation and led to a sharp rise in housing construction. In 2016, housing starts came to almost 37 000, the highest number recorded since the early 1980s. In the present situation, it has been sensible to pursue a potent countercyclical policy. Many countries have experienced that a sharp fall in output and employment can have long-lasting adverse effects. It must be recognised, however, that the longer-term challenges facing the Norwegian economy cannot be resolved by spending more oil revenues and keeping the interest rate low. Chart: Norway’s trade and current account balance As a small open economy, much of our welfare is based on trade with other countries, providing us with access to goods and services others are better able to produce. But we also have to offer something in return. High oil and gas prices have over the years generated large current account surpluses.
Page 1  The building blocks of resilience - speech by Sarah Breeden Given at Westminster Business Forum policy conference  Page 2  Published on 16 June 2023  Following the Financial Policy Committee's recommendations, Sarah Breeden sets out the steps being taken to build resilience within Liability Driven Investment funds. She then looks at other vulnerabilities within non-bank financial institutions and how the LDI framework could be applied to build resilience within these firms. Speech Pension funds have an enormous responsibility in ensuring that pension obligations are honoured while also playing a vital role in facilitating the flow of savings into investment, including funding productive finance[1] and climate resilience. [2] And they are key players in the gilt market which is vital to the functioning of sterling financial markets more broadly. On all these grounds, pension fund resilience is a key financial stability issue, which will be the topic of my speech today. I suspect I don’t need to remind this audience of what happened last autumn. You will all remember how poorly managed leverage[3] at some liability-driven investment (LDI) funds[4] amplified a sudden repricing of assets following the Government’s growth plan, creating a self-reinforcing price spiral in the long-end of the gilt market. The Bank of England (Bank) then undertook a targeted intervention in the gilt market in order to deliver our financial stability objective, buying time for LDI funds to build their resilience. [5] Even that brief reminder may have been enough to send hearts racing.

Muhammad bin Ibrahim: Audit as a partner of change Remarks by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 5th PETRONAS Board Audit Committee (BAC) Forum “Audit as a partner of change”, Kuala Lumpur, 16 August 2016. *  *  *  The theme of today’s forum “Audit as a Partner of Change” is highly relevant and timely, as the events in the global market today, involving failures of large firms, frauds and market manipulation activities, underscores the criticality of the three lines of defenses in organizations. For confidence and trust to be restored in the marketplace, the role of the BAC and internal auditors as the third line of defense will be even more critical than ever. Our role as members of audit committees is much broader than what we may perceive it to be. Organisations such as PETRONAS are widely regarded as amongst the few key flag bearers for the country. Hence, it is incumbent upon the Board and the BAC members to be strong and energetic in upholding the highest standards of professionalism, ethics and integrity in discharging their roles and responsibilities. The people of Malaysia must have confidence and pride that an institution entrusted with much strategic natural resources are run with utmost integrity and professionalism. Before I proceed further on the topic for today, allow me to touch briefly on the current outlook on the global and domestic economy.
This latter factor causes the current “premium” observed on electricity prices in France that are expected in the future markets for next winter. The bottom line is that it is not really possible to disentangle domestic and external factors in the rise in electricity prices, and thus to compute the additional “external tax” due to electricity. II. The ex-ante and ex-post distribution of the external tax Let me now turn to the second key issue: the question of the distribution of the external tax, or in other terms the burden sharing of the shock. I will illustrate this issue in the case of France for the energy bill only, for which more data is available at a granular level. Analysing this question involves three logical steps. First, how the increase in the energy bill is distributed “ex-ante” (as economists say) among households, firms and the general government, based on their respective volumes of energy  Page 9 of 14 consumption in the year before the price shock. In a second step, we need to take into account the fiscal measures put in place in 2021 and 2022 by the government in order to limit the energy bill of households and businesses – since they modify the distribution of the external tax. The third step should involve taking into account all the macroeconomic adjustments, in particular the pass-through of cost increases by firms in their sales’ prices and the response of wages to prices.

But the terms of trade  Page 6 of 14 shock could remain large if European countries need to replenish their gas inventories at a still elevated price for the winter of 2023/2024. In any case the terms of trade shock means a decrease of real income for the French economy and hence is a key driver of the slowdown in GDP growth expected for 2023. I.3 Measuring more specifically the energy shock Regarding the energy shock, which is useful to consider since we can more easily look at its distribution between economic agents, we can estimate it by applying the oil and gas price changes between 2021 and 2022 to the quantities of energy imported in a reference year, here 2021. Such a computation leads to an extra energy bill for France of 1.9% of GDP in 2022 compared to the previous year, or 47 billion euros. Note that, given the current exceptional volatility of natural gas prices, this estimation is very sensitive to price assumptions and the reference year. At the time of our previous projections last summer, gas prices expected in future markets for the last months of the year were much above the actual levels  Page 7 of 14 recorded since then. This explains why our estimate has fallen to € from € a few months ago.
It was now visible to the naked eye, without requiring sophisticated econometric models, that distortions from relatively high inflation are second order relative to losses from financial sector distortions (Stiglitz, 2010). That being said, it is safe to assume the crisis also shattered the illusion that the great challenges to the monetary policy decision-making framework have been overcome at least in part. Reality proved much too complicated to be managed based strictly on ideal theoretical schemes. In other words, textbook economics was no longer in tune with financial market realities. This also calls for rethinking the connections or retracing the boundaries between price stability and financial stability. The global crisis has once again drawn the attention of economic policymakers and theorists to the issue of separating or integrating price stability and financial stability tasks. The idea that the two tasks should be completely separated had gained ground before the outbreak of the crisis. The rationale behind this view was to free the monetary policy conduct from conflicting objectives and thus render policymakers’ mission and life easier. Following this line of thought, it was considered that two distinct entities should be in charge of the two tasks respectively. In particular, it was advocated that banking sector supervision should no longer be assigned to the central bank, but rather to an independent agency (which might also ensure the consolidated supervision of all financial markets).

Survey data available up to September confirm the weakening in the euro area’s growth momentum, while remaining consistent with a modest economic expansion in the second half of the year. Looking ahead to 2015, the outlook for a moderate recovery in the euro area remains in place, but the main factors and assumptions shaping this assessment need to be monitored closely. Domestic demand should be supported by our monetary policy measures, the ongoing improvements in financial conditions, the progress made in fiscal consolidation and structural reforms, and lower energy prices supporting real disposable income. Furthermore, demand for exports should benefit from the global recovery. At the same time, the recovery is likely to continue to be dampened by high unemployment, sizeable unutilised capacity, continued negative bank  BIS central bankers’ speeches  1  loan growth to the private sector, and the necessary balance sheet adjustments in the public and private sectors. The risks surrounding the economic outlook for the euro area remain on the downside. In particular, the recent weakening in the euro area’s growth momentum, alongside heightened geopolitical risks, could dampen confidence and, in particular, private investment. In addition, insufficient progress in structural reforms in euro area countries constitutes a key downward risk to the economic outlook. According to Eurostat’s flash estimate, euro area annual HICP inflation was 0.3% in September 2014, after 0.4% in August. Compared with the previous month, this reflects a stronger decline in energy prices and somewhat lower price increases in most other components of the HICP.