samchain/econo-pairs-v1 huggingface dataset:
Employment began to rise during the fourth quarter of last year, and unemployment has begun to fall. The forecast in our Monetary Policy Report is that unemployment will fall fairly slowly, and be just over 7.5 per cent in the year 2013. (Figure: Labour and employment and unemployment). Since the report was published the labour force surveys for June have been published. These show that employment increased slightly more, and that unemployment was lower during the second quarter of this year, than we had forecast. Inflation close to target of 2 per cent In our Monetary Policy Report we expect inflation to remain fairly close to the inflation target of 2 per cent during the forecast period. This is because, despite strong GDP growth, resource utilisation will be low, and this will hold back domestic inflationary pressure. Inflationary impulses from abroad will also be weak. But as economic activity recovers and resource utilisation rises, inflationary pressures will increase. BIS Review 109/2010  5  Our assessment was therefore that underlying inflation – measured in terms of the CPIF, the consumer price index with a fixed interest rate – would fall towards 1 per cent this year, and then rise towards 2 per cent at the end of 2012. CPI inflation, on the other hand, had increased during the spring, and we expected it to continue to increase as a result of rising interest rates, until it peaks at almost 3 per cent in 2013. (Figure: Inflation).

2  For the banks to manage the stress test their Tier 1 capital ratio, that is, their Tier 1 capital in relation to their risk-weighted liabilities, must not fall below 6 per cent. In the stress test the major Swedish banks were calculated to have Tier 1 capital ratios of 8.9–10.3 at the end of the test period. 4  BIS Review 109/2010  Strong GDP growth The Riksbank’s Monetary Policy Report from July forecasts relatively high GDP growth in the coming years: that Swedish GDP will grow by 3.8 per cent this year, and then by on average just over 3 per cent a year in 2011 and 2012. (Figure: GDP growth). We could also note that the first quarter of the year had been better than expected. It is particularly pleasing that the upturn was on a broad front – all of the components of GDP contributed to the upturn. Moreover, the Riksbank also saw good opportunities for a continuing recovery. Domestic demand is being maintained by a continued expansionary economic policy, combined with an optimistic view of the future in both the household and corporate sectors. In addition, growth abroad is expected to rise during the forecast period. This will contribute to an increased demand for Swedish export products, which in turn will benefit business sector investment as resource utilisation rises. Our picture of a recovery in the Swedish economy is also supported by new statistics published after the Monetary Policy Report.
Of course, since new forms of shadow banking activities are certain to develop in the future, FSB members will continue to monitor for emerging risks, and share data and analysis in order to support any future regulatory response. 9 The data refer to the UK, the US and the Euro Area, as of June 2009 (see Bank of England Financial Stability Report, June 2009). 5  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  5  These include reforms to secure the tools and powers authorities need to deal decisively with failing banks. At the same time, major banks are required to make themselves easier to resolve, including by writing ‘living wills’. Most importantly, global standards now require that banks hold sufficient debt in life such that, in the event one fails, its successor can be recapitalised to support the continued operation of its most important activities. The combination of these initiatives and the determination of authorities to complete the job explains why the too-big-to-fail public subsidy for private systemic banks has fallen by 90% in the UK. Put simply, a decade on, market discipline is coming back. The system is also fairer because we are addressing the root causes of misconduct. In the wake of the crisis, a series of scandals ranging from mis-selling to manipulation undermined trust in banking, the financial system and to a degree markets themselves. The economic consequences have been enormous.

The ratio of current account deficit to GDP is 11.8 percent in Bulgaria, 8.7 percent in Romania, 7.9 percent in Hungary and 7.2 percent in the Slovak Republic 1 . Another point that I would like to highlight about the current account deficit is that sustainability of high current account deficit depends on the financing quality of the deficit. Within this framework, I would like to present some figures on the maturity structure of capital inflows to Turkey. In April 2006, net capital inflow excluding IMF credits was USD 53.6 billion. The share of direct foreign investments and long-term capital in financing of current account deficit increases rapidly. In April 2006, long-term capital inflow became USD 23.2 billion and credit utilization of the non-banking private sector became USD 21.1 billion. The primary source of the capital inflow was long-term capital and credit utilization of the non-banking sector; 85 percent of which was long-term. Making a projection, we expect this financing structure to continue. According to the “Foreign Direct Investment Confidence Index”, which questions the countries’ capacity to attract investments over a 13 year period and which is an indicator of foreign direct investments that will come to the country, Turkey was the 13th most attractive foreign direct investment destination among 25 countries in  1  IMF, World Economic Forum, April 2006. BIS Review 68/2006  7  2005 2 .
Are we going to see the decline in the dominance of one global currency and its replacement by a new one or the formation of an alliance between currencies? Will it be the dominance of technology companies in providing payment services to the general public? TRUST Whatever the case may be, there is one thing we are certain of: Nothing has changed in our central banking task of maintaining the trust of the public in money and the financial system. Or to quote my colleague banker from the Bank for International Settlements, Mr Augustin Carstens, "The soul of money is trust.". We are still here to pursue monetary policy goals, to preserve the value of money by providing trust in the value of money and to offer money as a payment instrument that is widely accepted, secure, cheap and convenient. Our institutional task is to maintain confidence in the financial system and to serve as an anchor – a digital exchange for all other sorts of money that private issuers offer. To mention at this point – please, don't forget, everything you have today in your digital wallet, mobile banking app or similar is some sort of a payment instrument issued by a private entity. Some of them we supervise, some of them we don't. Whether it's a bank, a payment service provider, a stablecoin issuer or a globally interconnected anonymous network of nodes like Bitcoin, it isn't us you are banking with. But ... this may change.

On the basis of current information, annual HICP inflation is expected to remain at low levels over the coming months, before increasing gradually during 2015 and 2016. The Governing Council will continue to closely monitor the risks to the outlook for price developments over the medium term. In this context, we will focus in particular on the possible repercussions of dampened growth dynamics, geopolitical developments, exchange rate developments and the pass-through of our monetary policy measures. Turning to the monetary analysis, data for August 2014 continue to point to subdued underlying growth in broad money (M3), with the annual growth rate increasing moderately to 2.0% in August, after 1.8% in July. Annual growth in M3 continues to be supported by its most liquid components, with the narrow monetary aggregate M1 growing at an annual rate of 5.8% in August. The annual rate of change of loans to non-financial corporations (adjusted for loan sales and securitisation) remained negative at –2.0% in August, after –2.2% in the previous month. On average over recent months, net redemptions have moderated from the historically high levels recorded a year ago. Lending to non-financial corporations continues to reflect the lagged relationship with the business cycle, credit risk, credit supply factors and the ongoing adjustment of financial and non-financial sector balance sheets. The annual growth rate of loans to households (adjusted for loan sales and securitisation) was 0.5% in August, broadly unchanged since the beginning of 2013.
Each firm benefits from a pool of competitors taking different positions. There are also some centrifugal forces that tend to limit the size of clusters and ultimately drive firms away. The more concentrated the activity, the more vulnerable trade can be to external shocks, whether from earthquakes, wars or taxes. If there are restrictions on the supply of labour, concentration can lead to shortages. And of course clustering can drive up prices of other factors of production. In a successful urban centre, land in particular can become expensive. The history of the City of London But on balance the history of London’s financial sector illustrates how powerful the factors leading towards concentration and clustering have been. During the 18th and 19th centuries, it was not hard to see why international finance developed in London alongside Britain’s pre-eminence as an economic and trading power. The need to provide finance for trade stimulated the development of the money markets here, based around commercial bills, and that in turn provided essential liquidity for longer-maturity securities markets. 6 By 1914, while Britain had been overtaken as the world’s leading economy, it remained the hub of the international monetary system – the Gold Standard. UK had 42% of the world stock of overseas investments and around one third of all the negotiable instruments in the world were traded on the London Stock Exchange.

•  What about the more difficult question of whether monetary policy should be used to lean against the wind. The answer is a more obfuscating “that depends.” Specifically, it depends on the efficiency and efficacy of the macroprudential tools and institutional framework available, a point eloquently made by my colleague Don Kohn recently (Kohn 2015). •  Take the extreme case in which there are no macroprudential tools. In such circumstances monetary policy may be the only means of tackling system-wide financial risks, but it would come at the cost of significant effects on the real economy – precisely because monetary policy “gets in all the cracks.” For example, some empirical work by former Deputy Governor Charlie Bean suggests that setting Bank Rate around 200 basis points higher than it was over the over the period 2003–2006 would have reduced the growth in the ratio of household debt to GDP by just 2 percentage points from 2003–2007 at a cost of GDP growth over this period being 2.6 percentage points lower (Bean et al 2010). •  By contrast, the targeted nature of the tools available to the Financial Policy Committee under the current institutional framework in the UK makes them a natural first line of defence for dealing with build-ups in financial system vulnerability while minimising the knock-on effects to the rest of the economy – as was recognised in the financial stability knockout built into the MPC’s forward guidance.
So today it would probably be useful for me to take a few minutes to share with you on what the HKMA has been doing to develop our bond market, and more importantly, what our market can offer to investors. Development of the bond market in Hong Kong Let me give you a quick overview of the current status of the Hong Kong dollar debt market. At the end of 2005, the value of outstanding Hong Kong dollar debt reached $ billion HK dollars, equivalent to $ billion US dollars, which is over 30 times the size of the market 14 years ago. The size of the HK dollar debt market relative to GDP also increased significantly to 48% in 2005 from 3% in 1991. In 2005, the gross issuance of Hong Kong dollar debt reached $ billion HK dollars, or an equivalent of $ billion US dollars. Everyday, overseas borrowers, financial institutions and corporations participate actively in our market. In Asia, our market has the highest proportion of overseas issues, with the amount outstanding being only second to Japan and Korea. While we have a very well developed debt market today, one should be aware that there was virtually no debt market in Hong Kong before the 90s. Because of cumulative fiscal surplus, the Hong Kong government had not found it necessary to borrow any money in the market at that time.

The year 2006 will witness the release of two important policy documents: the Ninth Malaysia Plan and the Third Industrial Masterplan. The Plans will outline the key policy directions over the next several years to enhance Malaysia's long-term growth prospects, including: (i) the role of agriculture and the nascent biotechnology industry; (ii) moving up the value chain in the manufacturing sector; (iii) the increasing importance of services, especially business and shared services, including outsourcing; and (iv) the importance of education in developing the human resources needed to achieve the development objectives. An important strength of our economy for several decades now, is its flexibility, that is the ability for resources to shift to new areas of comparative advantage in response to changing conditions and new opportunities in the global economy. In particular, there is a high degree of labour and capital mobility. Significant investments in training and education have allowed labour to adjust and become more mobile. This has played a large part in enabling rapid industrialisation and in shifting to higher value added activities. Capital has also shown greater mobility, expanding the potential for the economy to adjust. Malaysia has also actively identified and develop new sources of growth, leveraging on its resource advantages and new technologies to move up the value chain. There have also been greater moves toward removing rigidities and transitioning toward greater market orientation and competition. Turning now to monetary policy, Bank Negara Malaysia's determination of interest rate policy is based on the requirements of the domestic economy.
Home bias in the debt instrument market euro area countries (annual data) among euro area countries (annual data)  Sources: IMF, Thomson Financial DataStream, Sources: BIS, IMF, ECB calculations. ECB calculations. Note: The home bias of the euro area is computed Note: The home bias of the euro area is computed excluding intra-euro area asset trade allocation. excluding intra-euro area asset trade allocation. Indeed, a simple inspection of the data reveals that European countries increased their holdings of euro area international assets (as a share of their total international portfolio) between 1997 and 2003 (see Charts 5-6). 10 Over this period, the share of intra-euro area allocation increased markedly by 10 percentage points for equity portfolios and by almost 25 percentage points for fixed income portfolios. 10  12 EMU countries consists of the 12 euro area countries. “Other EU countries” refers to Denmark, Sweden and the United Kingdom. “Non-EU developed countries” comprises ten other developed countries: Australia, Bermuda, Canada, Iceland, Israel, Japan, New Zealand, Norway, Singapore and the US. “Emerging markets” is formed by 7 countries: four Asian emerging markets (Indonesia, Korea, Malaysia and Thailand) and three Latin American emerging markets (Argentina, Chile and Venezuela). BIS Review 43/2006  5  Moreover, global financial integration was accompanied by a large shift in holdings towards the euro area countries, thereby favouring international risk-sharing vis-à-vis the euro area, particularly with regard to other European countries and, to a lower extent, with respect to emerging markets in equity portfolios (see Charts 5 and 6).

This is because the tendency to invest more in international markets – as reflected in the surge in crossborder portfolio flows – has been accompanied by the tendency of households to shift part of their savings towards riskier domestic assets, as the sharp rise in countries’ domestic market capitalisation reveals. What can we say about the future? We should expect that home bias will continue to decline, most likely at a slow pace, because investors need to perceive that diversifying their global portfolio more and more on a global scale will reduce risk; for that they need to become more familiar with the international environment. 7  See for example French and Poterba (1991), Coval and Moskowitz (1999) and Huberman (2001). 8  See Solnik (1974). 9  De Santis and Gérard (2006) provide the methodology here adopted to compute home bias measures. 4  BIS Review 43/2006  Impact of EMU on portfolio reallocation and financial integration Did EMU play a role in the reallocation of capital worldwide and on financial integration? To answer this question, we need to remind us what a monetary union implies. The elimination of the exchange rate risk is the first obvious implication, which is also a feature of other fixed exchange rate regimes. But the fundamental difference is that – when EMU was established – Member States committed to irrevocable conversion rates of their currencies.
It is not just total output that has exceeded expectations. The same applies to employment. In the first half of 1999 there were approximately 100,000 new jobs compared with the same period last year. Much of the increase occurred in the private sector. This has been accompanied by decreased unemployment, if one disregards the temporary seasonal upturn during the summer. However, the reduction of unemployment is less marked than the increase in employment because many people are returning to the labour market now that jobs are becoming available. Meanwhile, price increases have been moderate. The underlying rate of inflation (UNDIX, which measures inflation excluding interest expenditure, indirect taxes and subsidies) fluctuated during the spring between 12-month figures of 1.0 and 1.5%. Other indexes also point to low inflation, despite an increase in some commodity prices, oil in particular. Altogether, then, the Swedish economy is developing very well. We are now entering the seventh year of favourable economic growth – an average annual rate of about 3% – since the upturn in the summer of 1993. Today, moreover, there is no immediate threat to price stability. Market interest rates rising The better economic situation and expectations that inflationary pressure will be somewhat higher than before have caused a worldwide increase in market rates of interest. Sweden is no exception. During the summer the five-year T-bond rate, for example, has moved up just over 1.0 percentage point. Along with this increase, the spread between T-bond and other interest rates has widened.

European integration is a dynamic project, permanently under construction, which is today facing up to the challenges of a global economic recession and an international financial crisis of proportions unseen in many years. Over ten years ago, before the euro was created, there was an academic debate turning on the theory of optimal currency areas, which questioned whether a single interest rate and, therefore, a single monetary policy could possibly be appropriate for such diverse countries. Ten years after the birth of the euro those of us who joined EMU, and many of those who did not, acknowledge the enormous advantages of being inside the monetary union. Today, the contribution of the single currency in lessening uncertainty for economic agents is clear. The enormous advantages of moderate inflation, of interest rates with a limited range of volatility and of the fact that companies need not consider the exchange rate when buying and selling in an area with almost three hundred and thirty million consumers, are obvious. The upshot is stability, which is a valuable contribution to growth, as we have seen in other, similar-sized monetary areas such as the United States, and we should build on it. We should also celebrate the institutional success of the Eurosystem. The ECB has fulfilled the goal entrusted to it by the Treaty, of keeping inflation expectations anchored, even at very difficult times. And the Eurosystem is in itself a truly fascinating experiment.
Mean squared gaps (output) Production  Higher  6.0 4.0  Main  Per cent  -1.0  Lower  -2.0 -3.0 -4.0 -5.0  0.20  0.40 CPIF  0.60  08  0.80  c. Mean squared gaps (hours)  09  3.0  10  11  12  f. Hours-worked gap 2.0  4.0  Hours  12  0.0  2.0 0.0 0.00  11  e. Output gap 1.0  8.0  10  Per cent  1.0  Higher  0.0 2.0 1.0  -1.0  Main  -2.0  Lower 0.0 0.00  -3.0 0.20  0.40 CPIF  0.60  Main  08  0.80  Lower  09  10  11  12  Higher  To determine which repo rate path is most appropriate, a comparison must be made of the forecast for inflation and resource utilisation for alternative repo rate paths. Such a comparison is presented in Figures 2.13–2.15 at the end of Chapter 2 of the Monetary Policy Report. I present a similar comparison here in Figure 1. Figure 1 shows the consequences of alternative repo rate paths for the forecast for inflation and resource utilisation. The different repo rate paths are shown in panel a. In the middle is the main scenario’s repo rate path – the repo rate path that the Executive Board majority chose at the meeting in February.

Lars E O Svensson: Why a lower repo rate path? Speech by Prof Lars E O Svensson, Deputy Governor of the Sveriges Riksbank, at Umeå University, Umeå, 24 February 2010. *  *  *  The opinions expressed herein are my own and are not necessarily shared by other members of the Riksbank’s Executive Board or staff. I would like to thank Hans Dillén, Karolina Ekholm, Per Jansson, Pernilla Meyersson, Staffan Viotti and Svante Öberg for their valuable comments. Hanna Armelius has contributed to this speech. In this speech, I would like to explain why I entered a reservation the most recent monetary policy meeting and justify why I preferred a lower repo rate. I will also explain why I consider that mean squared gaps should be used, to a greater extent, as a measure of the extent to which monetary policy has succeeded in stabilising inflation around the inflation target and resource utilisation around a normal level. Such measures entail a new step towards a more transparent and systematic monetary policy. The Sveriges Riksbank Act and the preparatory work for it specify that monetary policy should be directed towards stabilising inflation around the inflation target and resource utilisation around a normal level. The lower repo rate path I advocated at the most recent monetary policy meeting would provide a better outcome for both inflation and resource utilisation, with both higher resource utilisation and CPIF inflation closer to the target.