samchain/econo-pairs-v1 huggingface dataset:
This is because at least some of the houses bought prior to the price rise today are sold at a higher price. The calculated mortgage interest expenditure for home-owners can thus change even if the interest rates remain unchanged, if the acquisition value of the housing stock changes. This is an effect that will have significance in the future. House prices have risen over a long period of time, and this will gradually have an impact on the capital stock index. Without going into any technical details regarding calculation methods, one can observe that this is the main reason why mortgage interest expenditure for home-owners will increase in the coming years – or, in other words, why CPIX inflation will be below CPI inflation. The Riksbank is assuming that the difference in the rate of increase between the CPI and the  BIS Review 73/2008  3  CPIX as a result of the housing stock increasing in value will be approximately 0.2 percentage points several years ahead. The fact that mortgage interest expenditure for home-owners is affected not only by changes in interest rates but also by the way house prices develop comes as no surprise. But one can say that the trend rate of increase in the capital stock has meant that the problem has gradually become more tangible. Other problems with the CPIX There are also other problems with the CPIX, related to calculation methods, which have perhaps not received so much attention. The CPIX measure adjusts for indirect taxes.

The authorities responsible for the economy are in coordination and they are monitoring developments pertaining to the current account deficit very closely. As long as the steadfast implementation of the current program is continued without concessions, the current account deficit’s potential to pose a risk will diminish. Today, I am delighted to be here with you and to have the opportunity to explain the latest developments in the Turkish economy, as well as the Central Bank’s policies. I would like to take this opportunity to reiterate the message that our active communication strategy will continue together with the same transparent and steadfast attitude. Thank you very much. 2  8  A.T. Kearney, FDI Confidence Index, Global Business Policy Council 2005, Vol. 8. BIS Review 68/2006
The resilience of the market in the face of the latest shocks has increased confidence in future financial resilience. In these conditions, market participants face more acutely the classic dilemma of deciding whether to follow the market, or to buy more insurance against the risk of a reversal at the expense of near term returns. This mix of forces operating on financial conditions presents challenges for policymakers and financial markets participants, for it makes it harder to figure out what is fundamental and enduring and what is temporary or transitional, or the result of policy distortions. Confidence exists alongside concerns about sustainability. Although there is much that is positive in the world today, there is little reason to believe we have entered a new era of permanent stability. Financial innovation and global financial integration do not offer the prospect of eliminating the risk of asset price and credit cycles, of manias and panics, or of shocks that could have systemic consequences. Over the past 25 years or so, we have seen a significant number of episodes of financial shocks, in U.S. markets and globally. Although more different than similar in their nature and impact, they had some common features. They were unanticipated. The causes varied, with some associated with a substantial deterioration in the real economy, and others not. And they typically involved the dynamic in which a sharp change in risk perception results in a fall in asset prices and a sharp reduction in market liquidity, and an increase in correlations across asset classes.

In the meantime, inflation is uncomfortably high, and an absolute precondition for maintaining our support to demand is the credibility of monetary policy. Over the next few quarters, the Committee’s most important judgment call will be put to the test. We will all discover whether inflation declines rapidly from 5% towards 3% as the effects of the price level shocks wane. Finally, let me stress that the gloom should not be overdone. The record is that flexible economies with sound macroeconomic regimes recover from almost any crisis. The UK will recover. Meanwhile the MPC will continue to underpin demand, consistent with getting back to the 2% inflation target and so with sound money. BIS central bankers’ speeches  3
The Riksbank has specified this as a target for inflation, according to which the annual change in the consumer price index (CPI) is to be 2 per cent.”    “At the same time as monetary policy is aimed at attaining the inflation target, it is also to support the objectives of general economic policy with a view to achieving sustainable growth and high employment. This is achieved through the Riksbank, in addition to stabilising inflation around the inflation target, also striving to stabilise production and employment around long-term sustainable paths.”  1  Monetary Policy in Sweden, Sveriges Riksbank, 3 June 2010. BIS Review 130/2010  1  Production and employment are thus included in the monetary policy analysis in two ways. Firstly, stable production and employment around levels that are sustainable in the long run are important objectives for economic policy. Secondly, the level of production and employment in relation to potential production and employment – or put another way, resource utilisation – is an indicator of future inflationary pressures. How are potential GDP and resource utilisation measured? Resource utilisation can be measured in many different ways. I would like to focus on the GDP gap. The GDP gap has the advantage of providing the most comprehensive picture of the extent to which resources in the economy are being used and GDP is the central forecasting variable. The GDP gap is the difference between actual GDP and potential GDP.

Total GDP growth for the three years 2010–2012 is just above 10 per cent, which is four percentage points more than growth according to trend of just above 6 per cent. What does resource utilisation mean to inflation and current monetary policy? Previously, I said that the Riksbank also strives to stabilise production and employment around development paths that are sustainable in the long term, and that by potential GDP I mean the level of GDP that is compatible with a utilisation of available resources sustainable in the long term and that will not push inflation up or down. As you know, the target for monetary policy is to keep inflation at a low and stable level. However, one problem when shaping monetary policy in practical terms is that the link between resource utilisation and inflation is not particularly clear. I will now discuss what resource utilisation means to inflation. 6  BIS Review 130/2010  In Sweden, the link between resource utilisation and inflation has been weaker since the mid1990s than it was previously. This is due to the fact that monetary policy has gained a high level of credibility. As long-term inflation expectations among households and companies are now solidly anchored around the inflation target of 2 per cent, there is simply not much scope for other variables to affect inflation. However, it is also due to the fact that inflation is affected by many other factors than resource utilisation, such as variations in energy prices, exchange rate fluctuations and changes in interest rates.
This definition has not changed since it was adopted in 2003 and is broadly shared today by all the main central banks of developed countries, including the United States and the United Kingdom. In the current environment, it is important to recall that monetary policy has an internal aim (keeping inflation under control), not an external aim (devaluing the exchange rate, which could trigger negative chain reactions). Why 2% and not 0%? In order to keep a safety margin, as inflation that is too low is as bad as inflation that is too high: it creates the risk of deflation, i.e. a general and lasting downward spiral of prices, which generates a fall in economic activity and a rise in unemployment. Furthermore, slightly positive inflation oils the wheels of the economy, for example when there are labour market rigidities or differences between regions of the euro area. The stability of financing via the decline in interest rates Controlled inflation results in a fall in market risk premia: this leads to lower interest rates in the euro area, and especially narrower spreads between countries. Let us take the example of our respective countries. . Before Maastricht, between 1986 and 1992, the spread between Italy and Germany was 5.1% on average, while it was just 1.4% in 2016. Admittedly there were pressures in 2011–2012, stemming directly from temporary doubts over the sustainability of the euro area. For France, the spread has also narrowed, from 1.9% between 1986 and 1992 to 0.3% in 2016.

Since the introduction of the euro in 1999, the average interest rate on three-month euro deposits has been 3%, while the three-month Swiss franc rate has been 1.4%. If we assume a difference of about 1% in the expected level of inflation between the euro area and Switzerland, the Swiss real interest rate advantage accounts for 60 basis points. •  Switzerland is also a firm believer in flexible exchange rates. Our monetary regime has been unchanged since 1973, when the peg to the US dollar was removed. Today, the Swiss franc is freely determined by market forces. Our last foreign exchange intervention dates back to 1995 – and that was a coordinated action in favour of the US dollar! •  And what about the European issue? As you know, we are not a member of the European Union; nor do I foresee Switzerland joining the EU in the near future. The Swiss people remain sceptical about the efficiency of the Union and are very aware of what they stand to lose in terms of political rights and economic freedom in the event of integration. But our relationship with the EU is of key importance, since Europe accounts for two-thirds of our foreign trade. In order to secure our access to the European market and to avoid discrimination, we concluded two packages of bilateral agreements with the Union – in 2002 and 2004.
We also know that there are a variety of mechanisms associated with globalization that lower the trajectory of inflation in the short run. For example, as the potential growth rate of an economy rises, it may experience more growth with temporarily lower inflation. But none of globalization’s effects on inflation, not even the potential reduction in inflationary bias, diminish the importance of the principal objective of central banks: setting policy to achieve low and stable rates of inflation over time. Doing this well requires the central bank to be able to discern features of the economy that it cannot know with precision - like the potential growth rate or the equilibrium real interest rate. It also requires a central bank to define and measure inflation in a meaningful way. We live in a world where the prices of some goods and services move in different directions and at different rates. The challenge for monetary policy makers is to look at this complex and changing picture of price changes and try to gauge the forces that are operating on underlying inflation and so judge the likely future path of overall inflation. As economies become more integrated, and as the share of goods and services that are “tradable,” or are affected by trade, increases, the challenge of extracting some measure of underlying or trend inflation gets more interesting. External factors can have bigger effects on the movements of some prices. The nature and duration of the external impulse or “shock” to relative prices may be hard to discern.

Timothy F Geithner: Global economic and financial integration – some implications for central banking Remarks by Mr Timothy F Geithner, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Columbia Business School Center on Japanese Economy and Business' 20th Anniversary Conference, Columbia University, New York City, 26 October 2006. *  *  *  Thank you. This is a time of remarkable evolution in the world economy. The share of the world’s population exposed to the opportunities and pressures of economic and financial integration is higher now than ever before. While we almost certainly do not fully understand the precise implications of this process for long-run global growth and welfare, we know that the gains to global growth and welfare have the potential to be large and pervasive. To acknowledge this potential is to acknowledge the merits of investing substantial intellectual capital into strengthening our understanding of the policy challenges and implications of global economic and financial integration. Compared to even a decade ago, world financial and product markets are significantly more integrated. Trade is a substantially larger and rising share of GDP, and the share of goods and services that constitute the “tradable” sector is increasing. Cross-border flows of real and financial capital have also increased dramatically - a reflection of the recent notable reduction in the degree of home bias in capital markets.
Finally, I would like to state that living and thriving within ecological limits is also about coming to terms with our own limits as human beings, and acknowledging our own mistakes. In an age of rampant ecological destruction and rising socioeconomic inequalities, we (policymakers, central bankers, economists, and so on) should also acknowledge the limits of the analytical frameworks and policy proposals that we have been using. In this context, The Green Swan reminds us that ecological risks (including but not limited to climate change) are so complex that we will never be able to accurately measure them, meaning that we should learn by doing. After centuries of economic development during which we did not care so much about the limits of the Earth (its resources and its ability to absorb pollutions such as carbon emissions), it is time to pause and think about what we have done. In ancient mythology Prometheus, who stole fire from the Gods ‐ i.e. encouraged energy consumption ‐ is severely punished, for eternity. Without envisaging such a punishment, we should react positively and decisively to the warnings we are receiving from scientists andfrom the authors of the Green Swan. Three underlying messages are enshrined in The Green Swan: acknowledging our multiple ecological crises beyond climate change; cooperating and coordinating our actions; and learning to live and thrive within limits.

For instance, the 2019 UN Global Assessment Report on Biodiversity and Ecosystem Services (IPBES)5 reminds us that human activity caused a catastrophic decline in Earth’s biodiversity (e.g. the current rate of extinction of species is between 100 and 1,000 times higher than the reference rate of the past million years). More recently the Dasgupta review6 in the UK states how severe the risks linked to biodiversity loss are and how complex the interactions between human actions and nature are. The scientific community actually tells us that these ecological risks are interconnected and should not be addressed in silo. For example, the concept of One Health developed by several international organisations suggests that human, animal and environmental health are interconnected and can only be addressed jointly. In its final declaration of the Global Health summit in Rome (May 21), President Mario Draghi stated:7 “The Rome Declaration rightly emphasises the importance of pursuing a One Health approach ‐ and here I’m coming to climate ‐, to preserve human, animal and environmental safety. This is the key priority of Italy’s G20 Presidency. The Scientific Expert Panel has stated how most infectious diseases are caused by pathogens that are derived from animals. Their emergence is largely driven by deforestation, wildlife exploitation, and other human activities. Effective environmental action can help to defend animal welfare and ultimately mitigate the risk of new health threats. When pursuing a common strategy to prevent future pandemics, we must uphold our commitment to limit environmental damage and tackle the climate crisis.
We also increase our autonomy and ensure that Europe is better protected in the world of tomorrow. As legislators, you have a crucial role to play in designing policies that can revitalise our economies. Digitalisation is a case in point. We need to fully reap the potential gains from digital technologies and, at the same time, make sure labour markets remain inclusive. If we don’t, we risk creating a new divide, and we can already see gaps opening up when we look at differences in wages, education levels and gender. [5] By implementing the right set of national and European policies, we will achieve more together than we can alone. At national level, we need to make the necessary changes to labour, product and financial market regulations, and invest in education to reduce digital exclusion. At European level, this should be  complemented by accelerating progress towards the Digital Single Market to help deliver economies of scale for digital firms, while addressing key concerns around cybersecurity and data protection. In a more digital economy, we also need to ensure the strength and autonomy of European payment systems. [6] The Eurosystem is actively pursuing initiatives to achieve this. We are also exploring the benefits, risks and operational challenges of introducing a digital euro. A digital euro could be a complement to, not a substitute for, cash; it could provide an alternative to private digital currencies and ensure that sovereign money remains at the core of European payment systems.

[7] 75% of people in 16 major countries expect their government to make environmental protection a priority when planning the postCOVID-19 recovery. See Ipsos  press release (published on 5 June 2020) about the results of a survey conducted between 21 and 24 May 2020 on the Global Advisor online platform. [8] Giuzio, M. et al. (2019), “Climate change and financial stability”, Financial Stability Review, ECB, May. [9] European Commission (2020), “  Identifying Europe's recovery needs”, Commission Staff Working Document, 27 May. [10] Through our ECB Listens portal, we are inviting euro area citizens, organisations and relevant stakeholders to contribute ideas and comments on the way we conduct monetary policy. European Central Bank Directorate General Communications Sonnemannstrasse 20, 60314 Frankfurt am Main, Germany Tel. : +49 69 1344 7455, email: media@ecb.europa.eu Website: www.ecb.europa.eu Reproduction is permitted provided that the source is acknowledged. Media contacts  Copyright 2020, European Central Bank
Muhammad bin Ibrahim: Demystifying cyber risks – evolving regulatory expectations Keynote address by Mr Muhammad bin Ibrahim, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the SEACEN Cyber Security Summit 2014 “Demystifying Cyber Risks: Evolving Regulatory Expectations”, Kuala Lumpur, 25 August 2014. *  *  *  It is my pleasure to welcome you to Sasana Kijang for the SEACEN Cyber Security Summit 2014. The theme “Demystifying Cyber Risks: Evolving Regulatory Expectations” is apt given that the subject is not well understood by most and developments in this area tend to change at an exponential rate. I would therefore like to commend the SEACEN Centre for taking an important step to strengthen awareness and promote collaboration among supervisors on cyber security issues. Cyber security risk gives rise to new challenges Cyber security risks are inherently complex. These threats are real and can have severe implications on financial institutions should the threat not properly managed. In 2013, more than 100 million customers had their credit card and personal information stolen as a result of a data breach at a major retail outlet in the US. The estimated cost of this incidence was close to $ million. For a single cyber attack, this is a staggering amount. Increased cyber security risk is a direct consequence of the more digital world we live in, where computing devices, online networks and technology infrastructure are becoming more integral to our daily lives.

Some would say that part of the answer would be to cap particularly retail interest rates charged by banks. Do you see that as part of the answer? This is a long-running debate here. Even though the ECB rate is quite low, when you look across Europe, the mortgage lending rates in Ireland are higher. The ECB has provided a legal opinion on the draft law, and it highlights, in line with the Central Bank of Ireland analysis, that a policy that caps the interest rate runs the risk of having an unintended effect, which is that it will deter entry. The Irish banking system is quite concentrated. Many people would like to see more banks enter to compete and, through competition, lower the rates. If you have a legal approach, where there is a legal regulation capping the interest rate, then the incentive for foreign lenders to come in is less. We have this long-running debate about the contribution of the quite high default risk in Ireland being built into those higher rates. I understand the intent: trying to make housing more affordable is a big issue. But personally, and in terms of the official advice of the ECB, we think capping interest rates is not the advisable way to go. You don’t even see a role for it, say, if you were to consider the housing situation to be an emergency scenario; that it would be a temporary measure given to the central bank? Well, again let me come back to the basics here.