samchain/econo-pairs-v1 huggingface dataset:
Whether or not these initiatives lead over time towards greater "convergence" of our financial systems in some structural sense – as they may – taken together with national deregulation they should at least contribute to greater competition, including cross-border competition, and help to improve the effectiveness of our financial systems in terms of the key criterion which I suggested earlier in my remarks. That is particularly true, at least potentially, of the steps proposed to advance the European single financial market, as set out in the Commission's Financial Services Action Plan, because of its broad scope. But progress has so far been painfully slow. In that context I welcome the recent emphasis on closer and more active co-operation between financial regulators within Europe, regardless of national regulatory structures. And I particularly welcome the proposals put forward by Alexandre Lamfalussy and his "Wise Men" for accelerating progress on measures that would encourage greater efficiency in Europe's securities markets. But there is clearly a great deal more that we can do in this whole area. Such changes in national financial services regulation, and related international and regional actions, taken together with increasing awareness in many parts of the world of the potential advantages of opening national financial markets to international competition, provide an encouraging environment for a second main driver of change in our financial systems – globalisation.

Neither is it unusual, if they do swallow the medicine, that the countries blame any side-effects on the IMF whether they were a result of the medicine or not; that the ownership – to use IMF vocabulary – is weak. At the same time, there may also be scope for the IMF itself to become better at operating in an environment where strong political considerations are present. •  Nor are groups of countries always willing at IMF meetings to raise questions of crucial importance to the world economy as a whole. Larger countries do not want to run the risk of coming under the spotlight. As a result, the big industrial countries normally prefer to discuss imbalances and exchange rates in a narrower circle, if at all. •  Also when dealing with financial crises, political considerations are constantly present. Everyone that follows IMF’s work in this area the last 10-15 years, has been able to see that geopolitical considerations sometimes play an important role when defining the conditionality – with mixed results. What can be done to strengthen the IMF? There is every reason to approach this question with humility. Many people have reflected on it and plenty of suggestions have been put forward in the debate. Since the crucial problems are political, they are also likely to require political solutions. In recent years, the discussion has focused on matters to do with quota, voice and representation (QVR). Many countries consider themselves to be underrepresented under the current structure.
There we made it clear that some deviations from the target level could be accepted, but that the Riksbank at the same time normally strives to bring inflation back to target level within two years. One reason for allowing deviations is that monetary policy does not make such a rapid impact and does not have the precision to closely steer inflation in the short term. Another reason is the need to be able to take account of other factors than inflation trends – for instance, growth in the real economy. The principle of normally bringing inflation back in line with the target within two years can be interpreted as a restriction the Riksbank has imposed upon itself to make its policy more clear. This restriction helps clarify the consideration normally given to factors other than the price stability target. However, sometimes situations arise where flexibility with regard to the target needs to be greater to avoid the effects on the stability of the real economy – variations in production and employment – reaching unacceptable levels. In extreme cases the deviations from the inflation target may be so large that it is neither possible nor desirable to return inflation to target within the usual two-year perspective. There are a number of examples of situations where considerations other than the assessment of CPI growth over the coming two years have affected our policy.

The ECB also announced additional easing at the end of 2015 and again at the beginning of 2016. Concurrently with the discontinuation of the minimum exchange rate, the SNB shifted the focus of its monetary policy. We moved the interest rate on sight deposits at the SNB deeper into negative territory. Money market interest rates have since settled at around −0.75%. We also underscored our willingness to intervene in the foreign exchange market as necessary. Both the negative interest rate and the willingness to intervene in the foreign exchange market were intended to cushion the effects of the discontinuation of the minimum exchange rate (cf. chart 5). Once the currency floor had been removed, the Swiss franc appreciated sharply in the initial period; the euro fell to parity against the Swiss franc and the US dollar depreciated by a similar amount. Both currencies have since regained ground, however. In recent weeks, the euro has been trading at around CHF 1.10; and for some time now, the US dollar has been trading above the level posted on average while the minimum exchange rate was in place. Overall, though, the Swiss franc remains significantly overvalued. At the last monetary policy assessment, which took place about six weeks ago, the SNB confirmed that the monetary policy it had been pursuing since January 2015 would remain unchanged.
Without these things, a statement that simply says “we expect such-and-such a policy to be appropriate given the current outlook” doesn’t seem to me to qualify, especially if it goes on to stress the dependence of one on the other. The same goes for forecasts of future interest rates based on the latest projections for the economy. These are just an effort to explain more about the “reaction function”. On these grounds, and even with a fairly liberal interpretation of these requirements, it’s difficult to pick out many episodes that clearly count as pre-commitment. Perhaps the US Fed’s communications during and in the years after the financial crisis came the closest, though the shift to more Odyssean-like guidance was as much evolutionary as revolutionary. The FOMC had begun to signal the likelihood of a long period of low interest rates as early as December 2008, though to begin with, this was phrased simply as what would be justified by the economic outlook: "Weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time” The following summer, the statement still explained the outlook for policy as a normal and justifiable response to that for the economy, but for the first time introduced specific timelines: “The Committee currently anticipates that economic conditions…are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013”.

In other cases, uncertainty about the possible consequences of Year 2000 disruptions could lead to over-reactions on the part of market participants. As supervisors, we will need to be increasingly alert to the possibility of Year 2000 rumors affecting the liquidity of firms during the latter half of 1999, and should support the disclosure of accurate information in response. The Basle Committee’s Year 2000 Task Force will be developing a contingency planning document focused on issues relevant for bank supervisors. I am pleased to see that the Joint Year 2000 Council also has formed a sub-group to address contingency issues, including sound practices for financial institution contingency planning as well as market-wide aspects. As I see it, there are three broad areas to consider in developing contingency plans. First, each firm should have a contingency plan that covers business continuity issues in the case of operational problems affecting its own systems. Institutions also should develop contingency plans that would help address Year 2000 problems arising from their vendors or customers, or as a result of disruptions to public infrastructure. These plans should seek to assess the risks that firms face in each instance and should focus on the possible measures that may be available to mitigate those risks. Second, supervisors and regulators need to develop their own contingency plans for how they will deal with problems affecting them or the institutions under their jurisdiction. Most organizations have some experience in contingency planning for various types of market disruptions, so this will not be entirely new ground.
Asia is growing in every segment of the insurance business, but I want to highlight the importance of infrastructure financing as an opportunity for insurers, as a way in which you can play a useful role in the economic growth of the region. I also want to highlight the criticality of catastrophe insurance and cyber insurance. Public-private collaboration is the way to go in all these areas and I’m glad we are off to a good footing in our relationship with industry leaders, and in tying together collaborations with the academia and research institutions. When we next meet three years from now in Singapore, we should be in a slightly better place. 6  BIS central bankers’ speeches

Our role in the world market for oil exports is more modest. Back in the 1970s, policymakers’ handling of the newly discovered petroleum wealth got off to a rather weak start. Public spending surged before export revenues had started to kick in. Fiscal policy fuelled a boom and had to be reversed and tightened. By the late 1970s, Norway was in the midst of a deep recession. In the mid-1980s, the Norwegian economy experienced a new boom, this time fuelled by private debt growth. After the fall in oil prices in 1986, we experienced a collapse in housing prices, as well as a severe banking crisis and a soaring public deficit. The turbulence made clear how vulnerable a small open economy is to terms of trade disturbances. The downturn in the early 1990s was the deepest that Norway had experienced since World War II. The authorities realised that the old policy framework was no longer suitable. With a globalised economy and deregulated credit and capital markets, our economy was more vulnerable to external shocks than before. A number of major reforms were implemented to improve cost competitiveness and boost growth. And the establishment of the oil fund in 1990 and the reform of the monetary policy framework in 2001 made the economy more robust to external shocks. Chart: Norwegian exports The need for a robust policy framework is greater than ever: Petroleum products now make up more than 50 percent of exports, and – more recently – oil services exports have also picked up.
BIS central bankers’ speeches  5  As you can see, the lessons of the crisis fall into two broad groups: Repairs and Revolutions. The changes in capital and liquidity regulation, however big, are essentially repairs. They improve on what was there before. There are revolutions on two fronts. Resolution regimes. And macroprudential regimes. As I have explained today, both will have a profound influence on supervision. Indeed, it is no exaggeration to say that, in the UK, the approach of the future Prudential Regulation Authority to banking supervision is being framed by the needs and goals of resolution and macroprudential oversight. Supervisors will focus to a much greater extent than ever before on coping with failure and on the stability of the system. That will become apparent in the years ahead. 6  BIS central bankers’ speeches

By end 2008, savings in the stabilization fund (FRR) , totaled DA 4113 billion ( equivalent to $ billion);  •  domestically financing the economy’s large investments, in the context of excess saving rates over investment rates;  •  developing the bond segment of the financial market, with access limited to domestic investors;  •  Advancing the restructuring of the banking sector following failure and bankruptcy of small private banks which resulted in withdrawing their licences over 2003-2006 while compensating depositors through the Deposits Guarantee Fund. The strengthened macroeconomic stability, as evidenced by subdued inflation (4.4 % in 2008 despite the surge in world commodity prices) and a real exchange rate of the Dinar near its equilibrium level, as well as important foreign exchange reserves $ billion, by end 2008) and low external debt, have constituted sound safeguards against the inherent shocks of the current international financial crisis. In addition, indirect monetary policy instruments (deposit auctions, marginal deposit facility, …) have been successfully used to limit the impact of structural excess liquidity on inflation. Although the direct contagion impact of the international financial crisis on the Algerian banking system is limited, in view of its small exposure to international financial markets, increased attention is directed to further strengthening and preserving its soundness. In this regard, the required minimum capital for banks and financial institutions have recently been substantially increased to strengthen their resilience and increase their lending capacity.
Chart: Level of debt high for many households Direct losses associated with loans to households are seldom large in Norway. Even during the banking crisis 20 years ago, losses were limited. However, historically low losses are no guarantee of low losses in the future. A mutually reinforcing dynamic of rising debt and increasing property prices characterises the run-up to financial crises. Higher property prices lead to higher collateral values for loans. With easier access to credit, purchasing power increases. The household debt burden is now higher than prior to the banking crisis. The increase has been highest for middle and lower income groups (deciles). The number of households with a very high debt burden is also far higher. The number is sufficiently high to engender negative spillover effects in the economy in the event of an abrupt change in household behaviour. Such spillover effects may in their turn affect bank losses, which is the main reason that the work on financial stability places particular emphasis on developments in the household sector. While monetary policy and fiscal policy have been anchored within a long-term, operational framework over the past ten years, there has been no comparable, coherent regulatory system for financial markets. Requirements are currently imposed on individual banks, but without adequate regard to overall risk in the financial system. This became clear during the financial crisis. New regulations are underway. The new Basel III framework aims to establish a long-term framework for financial market regulation that lays the basis for a robust financial system.

2  Normally, the reserve rate acts as a floor and the overnight lending rate as a ceiling for the overnight interbank rate, as banks will not normally lend reserves at an interest rate that is lower than the rate they receive from the central bank or borrow reserves at an interest rate that is higher than the rate they have to pay the central bank. There may be a stigma attached to using this lending facility. When this stigma cost is high, the market rate may exceed Norges Bank’s overnight lending rate. If one or more banks do not have access to the central bank’s deposit facility, the market rate may fall below the reserve rate. 3  Competition among banks keeps the overnight interbank rate close to the key policy rate. A bank holding reserves in excess of its quota towards the end of the day can avoid having to deposit these excess reserves at the reserve rate by lending in the interbank market to a bank with room on its quota. This bank will be able to deposit the borrowed reserves at the key policy rate and earn an interest rate margin as long as the borrowing rate is lower than the key policy rate. Competition among banks with room on their quotas pushes up borrowing rates and pushes down interest rate margins. 2  BIS central bankers’ speeches  the level of short-term money market rates. This also applies when the reserve rate is negative.
Willem F Duisenberg: Perspectives on EU enlargement Speech by Dr Willem F Duisenberg, President of the European Central Bank, on the occasion of receiving an honorary doctorate from IMADEC University, Vienna, 14 October 2002. *  *  *  Dear Klaus, Ladies and gentlemen, It is a great privilege for me to be awarded an honorary doctorate today by such a distinguished institution, IMADEC University, in Austria. It is also a great pleasure to hear the kind words of my colleague and friend, Governor Klaus Liebscher. When listening to Klaus Liebscher, who has indeed studied my curriculum vitae in great depth, Shakespeare's words came to my mind and I thought for a moment he had come to bury me, although he has actually come to praise me. I am afraid that this is the fate of anybody whose retirement comes within sight. Nothing but good should be said of the dead, they say. Considering that I am still alive, it is even more gratifying to hear nothing but good things about myself; perhaps with the exception of my addiction to tobacco - an addiction that Klaus and I happen to share. There is one thing I should like to emphasise in the laudation. As Klaus Liebscher has just said, my career has benefited from a “Summe von Zufälligkeiten” that I have been lucky enough to encounter throughout my professional life.

Also, the calendar for further price liberalisation, which has an impact on inflationary developments, is often set by each government and is thus difficult for a central bank to predict. From an ECB perspective, financial sector reform is also of the utmost importance. The reasons for this are mainly twofold. First, sound financial sectors are key to delivering “stable money”. Weak financial systems tend to blur the monetary transmission mechanism and the capacity of monetary policy to influence inflation and growth outcomes, putting the maintenance of price stability and the credibility of the central bank at risk. Second, financial sector reform is needed because it ensures that structural reforms, particularly in the goods and labour markets, become fully effective. Indeed, despite recent structural reforms and positive growth, the catching-up of per capita income with the euro area has remained limited, and in many countries output growth remains below potential. Efficiently functioning financial markets are an important precondition for an efficient allocation of capital, thereby contributing to an economy's growth potential. In many ways, the prospect of EU accession has been instrumental in triggering reform in accession countries, and structural reforms have advanced far enough in these economies to achieve macroeconomic stability. However, there is much that remains to be done. I am confident that the policy-makers in the region will “hear and listen” and remain committed to continuing along the path of reform on which they have already embarked.
The scale, pace and timing of any further increases in Bank Rate will reflect the Committee’s assessment of the economic outlook and inflationary pressures. The Committee will be particularly alert to indications of more persistent inflationary pressures, and will if necessary act forcefully in response. I’ll conclude by offering a few observations on this language from my perspective. First, by focusing on the ‘scale, pace and timing’ of further changes in Bank Rate, the statement clearly widens the discussion beyond the interest rate decision at the next meeting. In my view, this represents the desirable introduction of greater flexibility in our communication of the policy outlook relative to the previous language. It thus reflects the uncertainties we face, and the likelihood that we will have to take finely-balanced decisions over rates not just in August but also beyond that, in the face of two-sided risks to the economic outlook into next year. Second, by referring to ‘any further increases in Bank Rate’, the introduction of greater flexibility does not obscure that the next change in Bank Rate is more likely to be in one direction rather than another. We are talking about rate increases, not rate decreases. At the same time, the reference to ‘any’ increases allows for the possibility of remaining on hold, which helps to capture the potential breadth of opinions on the Committee: after all, we have seen votes to keep Bank Rate unchanged in recent meetings.

Over the ensuing months, members of the Committee and several of its working groups engaged in intensive work with industry participants—many of whose institutions are represented here today—to develop practical and prudent solutions in these areas. In addition, I am pleased to note that we worked very closely with our colleagues in the International Organization of Securities Commissions in the areas of trading book and double-default. In July this year, the Committee issued guidance in both areas. With the publication of these documents on trading book/double-default and downturn LGDs, the Committee has concluded the policy development stage of Basel II. The industry has voiced the opinion that, while it could be possible to continue refining the Framework, it is more important that there be a pause to allow banks to implement the Framework. I very much support this view. Our priority now should be to achieve high-quality implementation. A good example of how we, industry and regulators can collaborate, without the need to add additional rules, is what we did in the case of low-default portfolios. Several types of portfolios may have low numbers of defaults or a bank may not have sufficient loss experience of its own (e.g. portfolios of exposures to sovereigns, banks, insurance companies or highly rated corporates). The industry was concerned that the lack of sufficient statistical data in some portfolios and the resulting difficulty in backtesting risk parameters would result in LDPs being excluded from IRB treatment. We have published a newsletter clarifying our view.