samchain/econo-pairs-v1 huggingface dataset:
6  BIS Review 36/2005  Graph 5: Risk Premium and Real Interest Rates  1000  35  900  30  800  25  700 600  20  500 15  400 300  10  200  Risk Premium (JPMorgan) Real Interest (Calculated w ith inflation expectations)  100  5  Mar-05  Jan-05  Nov-04  Sep-04  Jul-04  May-04  Mar-04  Jan-04  Nov-03  Sep-03  Jul-03  May-03  Mar-03  Jan-03  Nov-02  Sep-02  Jul-02  May-02  Mar-02  0 Jan-02  0  Source: CBRT, JP Morgan. Graph 6: CBRT Interest Rates and Secondary Market Nominal Interest Rates 90 ISE T-Bill and Bond Market Interest Ratescompound  80  CBT Overnight Interest Rates  70  (%)  60 50 40 30  3/2/05  1/2/05  11/2/04  9/2/04  7/2/04  5/2/04  3/2/04  1/2/04  11/2/03  9/2/03  7/2/03  5/2/03  3/2/03  1/2/03  11/2/02  9/2/02  7/2/02  5/2/02  3/2/02  10  1/2/02  20  Source: CBRT, ISE. At this point, within the scope of the changing dynamics of inflation, I would like to talk about the passthrough effect of the exchange rates on inflation, which is quite significant not only in terms of the determinants of inflation, but also the current exchange rate regime.

Inflation, on the other hand, continues its downtrend in May, and although we see inflation numbers turning negative, the current uptick in commodities and asset prices, together with signs of greater stabilization in the real sector, help lessen the concern regarding deflation risk. Against this background, the Monetary Policy Committee in its meeting on May 20th held the view that monetary policy has been substantially eased and the current policy rate at 1.25 percent remains supportive of the economy. Two implications must be drawn from this decision. First, given the low policy rate and the ample availability of liquidity, more gains could be made by ensuring that, at the current policy rate, the benefits of past rate reductions are passed on more fully to consumers and the private sector through corresponding adjustments in the banking system’s interest rates. The second implication is that, while the  BIS Review 76/2009  1  emerging signs of stabilization are positive and are consistent with the developments on a worldwide basis, they must be treated with caution given that the current state of the global economy and financial markets are still far from normal. Hence, the MPC will continue to monitor closely the uncertainty surrounding both domestic and external economic conditions, and stand ready to implement appropriate monetary policy to support economic recovery in the period ahead. Turning now to the banking sector. The Thai banking sector was able to weather the impact of the global financial crisis with a relatively strong initial position.
6  BIS central bankers’ speeches  Figure 1 Quarterly economic growth (1) (q-o-q change, percent) 3  3  2  2  1  1  0  0  -1  -1  -2  -2  -3  -3 07  III.07  08  III.08  09  Developed (2)  III.09  Emerging (3)  10  III.10  (1) Regions weighted at PPP. (2) Includes: Australia, Canada, Denmark, the Eurozone, Japan, New Zealand, the Sweden, Switzerland, the U.K., and the U.S. (3) Includes Argentina, Brazil, Bulgaria, Chile, China, Colombia, the Czech Republic, Hong Kong, India, Indonesia, Malaysia, Mexico, Peru, the Philippines, South Korea, Russia, Singapore, South Africa, Thailand, Taiwan, Turkey and Venezuela. Sources: Central Bank of Chile based on each country’s statistics institute and International Monetary Fund. Figure 2 World growth (*) (y-o-y change, percent) 15 12 9 6 3 0 -3 -6 -9 -12 -15  15 12 9 6 3 0 -3 -6 -9 -12 -15 80  85  Developed  90  95  Chile  00  05  Latin America  10  (*) Gray area shows April 2011's WEO forecasts. Source: International Monetary Fund.

This is consistent with economic activity fluctuating around its full capacity level, going from periods of capacity under-utilization to periods of over-utilization. So the maximum level the MPR will ultimately reach and when this will happen in the current cycle is something the CBC Board will be analyzing as events unfold. This year to date, a 200 basis point increase has already accumulated in the MPR and we believe further increases will be needed. The magnitude and timing of these increases will respond to incoming data, risks and their implications for inflationary prospects, taking into account the lags that are inherent to monetary policy. Thus, no scenario can be ruled out. It is likely that in the coming meetings the magnitude of the correction will be reduced and there may even be pauses. Likewise, although today it seems less likely, it can also happen that the recent pace is maintained if inflationary risks so recommend. In any case, there seems to be consensus in market expectations that smaller adjustments will be required going forward. Actually, most forecasts place the MPR around 6% at the end of this year (figure 17). Conclusions The last several years have been very complex. Policy makers have faced probably the greatest challenges in decades. Swings in economic activity, inflation and expectations, among many other variables, have been marked in unprecedented ways. Chile’s macroeconomic policy framework has given proof of its flexibility and effectiveness, succeeding in mitigating and overcoming the effects of the world crisis. Today we face new, significant challenges.
The experience at federal level motivated various cantons to follow suit. This has proved to be a very effective fiscal policy reform. The debt brake is a rule that links expenditure to the amount of cyclically adjusted revenue. It aims at a balanced structural budget over the medium term. Fiscal policy maintains a countercyclical profile through the mechanism of automatic stabilisers. The strict implementation of this rule led to  BIS central bankers’ speeches  5  significant budget surpluses in the boom years preceding the global financial crisis. Importantly, the debt brake has made it possible to regain control over public spending, which had steadily increased during the 1990s. Since the main focus of the debt brake rule is on long-term sustainability, the framework leaves little room for discretionary spending. The Federal Government can make an exception and allow additional emergency spending only in the event of a proven severe crisis. During the recent crisis, the healthy state of Swiss public finances enabled the automatic stabilisers to play their role to the full extent, which contributed to supporting the economy, without threatening medium-term fiscal stability. In particular, public spending on the unemployed and short-term workers increased significantly, while income and profit tax revenues decreased. Contrary to what we have seen in other countries, no tax increases or austerity measures were needed to correct the public finance trajectory. This has had a positive impact on households’ disposable income, and hence on both private consumption and business confidence.

In the euro area, meanwhile, the ECB made it clear that additional monetary stimulus would be required. A tangible sign of these diverging patterns was the substantial weakening of the euro against the dollar. With the clear prospect of a significant QE programme in the euro area, the pressure on the minimum exchange rate intensified hugely at the beginning of 2015 – especially in the last few days leading up to the SNB’s decision on 15 January. Against that backdrop, the minimum exchange rate became unsustainable and the SNB had no choice but to discontinue its policy. By maintaining the minimum exchange rate for longer, the SNB would have run the risk of losing control over its balance sheet. This, in turn, would have hampered its stability-oriented policy in the future. Once you have arrived at such a conclusion, you have to act swiftly. Speculative position-taking against the minimum exchange rate could easily have caused the SNB’s balance sheet to double within a few months. We would subsequently have been compelled to discontinue the exchange rate floor under even greater pressure, with all the consequences for our balance sheet and the Swiss economy that this would have implied. The costs of maintaining the floor would have been out of all proportion to the benefits. As a consequence, the Swiss economy is now dealing with very difficult exchange rate conditions. In an interdependent world with highly integrated and liberalised capital markets, the strengths of an economy like Switzerland can, paradoxically, turn into a major challenge.
And the value of stress testing and scenario analysis is even more important in those situations where risk measurement is based on scarce or incomplete data or unproven quantitative tools. The above mentioned examples demonstrate the clear view we have taken in the Committee that the sound and stable functioning of credit institutions requires consideration not only of micro conditions, but also, and very importantly, incorporating a macro, long-term and forward-looking perspective. I think these principles also make good business sense. I believe that risk managers, should incorporate macro perspectives into their risk management models and into the design of the bank’s capital strategy. That is, to analyse how risks may change through the cycle and in stressed economic conditions, and incorporate these elements into the decision-making process. It is often thought that risks increase during times of economic downturn. But this is only partly true. Banks’ risks increase as they take on more business and extend more credit during times of economic expansion. The risks may not crystallise until times of difficulty, but the seeds are sown during the  BIS Review 46/2006  5  good times. It seems to me to be both prudent policy and consistent with risk management objectives to take a long term perspective, using the results to make decisions that gain room for manoeuvre in the good times in order to face up to difficulties that arise in the bad times..

Over 500 organisations have endorsed the TCFD recommendations, with a total market capitalisation of $ trillion. 9  See TCFD (2017), ‘Final Report: Recommendations of the Task Force on Climate-related Financial Disclosures,’ June 2017. 5  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  5  The implementation report issued by the Task Force in September 201810 – a year after the recommendations were first published – assessed some 1800 companies (that made some reference to climate in their reporting) using artificial intelligence, and analysed in more detail an additional 200 of the largest companies, drawn from eight representative sectors. Across both, it found that a majority of companies already disclose information in their 2017 filings that aligned with one or more of the TCFD’s recommendations. Reporting by the largest companies appears to have been more sophisticated – with a higher share of the firms reporting against more of the TCFD recommendations. This is remarkable given companies only had about six months to respond to the final TCFD recommendations in their 2017 filings. That said, compared to both the recommendations and user expectations, more progress is needed.
In investment, a weak performance is anticipated for the remainder of 2022 and all of 2023, in line with the more persistent rise in the real exchange rate, worse financing conditions, the reduction in the investment outlook contained in the latest survey of the Capital Goods Corporation (CBC) (public works, mining and energy projects) and the weakness of construction sector indicators. In addition, the pessimistic outlook for the sector (IMCE) and the current high uncertainty. It should be noted that the fall in the machinery and equipment component would be lower than expected, given the higher volume of capital imports, mainly associated with energy projects and transportation and telecommunications. 3  Bilateral Meetings  Market forecasts for activity and demand exceed those of the central scenario, especially for 2023, even considering the corrections after the IPoM was published. The differences are especially notable in the case of private consumption. Certainly, the external impulse that the Chilean economy will receive will be lower than in previous years and what we anticipated some months ago, mainly due to less favorable financial conditions and terms of trade, together with lower external demand. In this macroeconomic scenario, inflation will return to the 3% target within two years. Core inflation will decline more slowly, affected by higher persistence. Our closing inflation projections —at the beginning of September— were made with a nominal exchange rate at $ In recent days, it is closer to $ a depreciation of around 5%.

Therein lies our biggest challenge. Prices for services have been rising at a fast rate as the economy has recovered from the recession. In particular, rents for new leases have climbed rapidly. And labor shortages are everywhere, leading to higher labor costs. Indeed, inflation pressures have become broad-based across a wide range of goods and services. Good News and Bad News What does the future hold? I will start with some good news. First, prices of many commodities, such as lumber, are in retreat. Absent further supply disruptions, I expect slowing global growth, in part reflecting tighter monetary policy here and abroad, will continue to reduce demand for these products. This should put downward pressure on commodity prices and help ease inflationary pressures, especially for goods and services that are heavily reliant on commodity inputs. Second, we have seen significant improvement in global supply chains, and I expect this to continue. At the New York Fed, economists have developed the Global Supply Chain Pressure Index, which measures the extent of global supply-chain disruptions by summarizing a variety of data, including reported delivery lags and the costs of transporting goods. The Index soared to unprecedented levels late last year but has  2/5  BIS - Central bankers' speeches  now reversed about two thirds of its rise. Although significant supply-chain problems are still affecting some industries, such as autos, improvements in supply should help ease supply-demand imbalances and result in lower prices for affected products. 3 Unfortunately, that's it for the good news on inflation.
One essential question is whether, in general terms, short-term stabilisation policies should be pursued in an attempt to bring about high real growth in the long term. It is worth emphasising here that monetary and fiscal policy differ in how promptly they react to changes in economic circumstances. In principle, the Riksbank can adjust its instrumental rate at any time whatever so as to stimulate or curtail demand. At the same time, however, the impact of such measures can be expected to peak only after 1 to 2 years. This means that monetary policy should be framed primarily with a view to its long-term effects. Fiscal policy, in contrast, can have a major direct impact on the economy, but its most important components resist rapid change. There are administrative costs associated, e.g. with changing tax rates, and changes in regulations take time to implement. This means that fiscal policy is difficult to adapt quickly to meet changed economic prospects. This leads to the conclusion that even if monetary policy can react immediately to changes in the economic situation, neither monetary nor fiscal policy should aim to influence economic conditions in the short term, i.e. to function as instruments of “fine tuning” stabilisation policy. Instead, both monetary and fiscal policy should be designed so as to create stable long-term conditions. The contribution made by monetary policy to welfare is precisely to create as stable conditions as possible in the economy by means of the inflation target policy.

Since the inflation risk premiums are low, employees will not need to demand extra high nominal wages to insure themselves against unexpectedly high inflation. This is because it can be anticipated that the central bank will tighten monetary policy. This in turn will mean that less stringent measures will probably be required than would be needed by a central bank that had not yet established its credibility. BIS Review 132/1999  2  Turning more specifically to the situation in Sweden, it can be said that the macroeconomic conditions today are favourable: inflation is low, budget deficits have been transformed into surpluses and the prospects for growth are good. However, economic policy is a continuous learning process and the successes of recent years should not be taken as evidence that the structural problems have been solved. On the labour market, for example, structural rigidities remain; also, the tax-pressure is still high, which inevitably distorts incentives to work and save. As far as monetary policy is concerned, the credibility of the inflation target regime has as yet hardly been tested in a period of economic upturn. What does this mean for how much and how often monetary policy should react to changes in the economic outlook? This, of course, is a question that the Executive Board of the Riksbank addresses on an ongoing basis, communicating its views in inflation reports, the minutes of its meetings and speeches.
It seems very timely that we overcome the history that has separated us and begin working more closely together. During the Cold War, it was the view of many in the United States that India was too closely allied with the Soviet Union. American businesses that looked at India found it afflicted with the legacy of the worst of British bureaucratic administration. (The old joke was that you could never get morning tee times at any Indian golf course because the bureaucrats had locked them up at least until noon). From an Indian perspective, America seemed too hegemonic. Attempts by U.S. companies to invest and do business in your homeland revived memories of the East India Company. We viewed each other through the lens of the time and against a background of our own histories, with suspicion. But the (Berlin) Wall came down, the economy has been globalized and cyberized, and new threats to security have arisen, many of them from nonstate actors or forces who operate from within failed states to inflict damage elsewhere. This is a time for like-minded people to unite and work together. We are like-minded in that we are democracies. But tonight we celebrate something even more fundamental. My reading of India is that, like in the U.S., your country men and women are more pragmatic and business-oriented than they are ideological or inherently bureaucratic. The recent election of Prime Minister (Narendra) Modi offers the promise of making this abundantly clear.

And I trust they and others like them will use it to lead the world, including India, to expanded economic prosperity. Thank you for having me here this evening. 4  P.G. Wodehouse is widely read and wildly popular in India. BIS central bankers’ speeches  7
This shortcoming has clearly contributed to the situation we face today. Unwinding its consequences is the key challenges the euro area faces. So let me now discuss how we can address that challenge. Fixing EMU for the long-term Unwinding the euro area’s imbalances What is the way out of this situation for the euro area? First and foremost, the imbalances that accumulated in certain euro area countries have to be remedied by those countries themselves. Under present rules, other member states can only provide some interim financial assistance and have indeed done so via the EFSF/ESM. The indispensable national consolidation effort by the more indebted countries is the implication of a system where fiscal, economic and financial policies are basically decentralised. But despite a difficult start, a significant rebalancing is now happening within the euro area. Across the euro area, strong budgetary consolidation is taking place. The IMF forecasts that the euro area’s primary budgetary position will be almost in balance this year. This is quite an achievement in an international context: Japan, for example, will have a 9% of GDP primary deficit this year, the U.S. 6.5% and U.K. more than 5%. And the euro area is not only performing well on average: each individual member country will have this year a primary budget deficit lower than those three countries. 4  BIS central bankers’ speeches  Important improvements are also taking place in competitiveness. Member States have now started to undertake structural reforms to facilitate intra-euro area adjustment.

Following the last decision to reduce the interest rate on 22 September 1999, we signalled that our forecasts indicated a greater probability that the next interest rate change would be a reduction, although we did state that there was little room for further reductions in interest rates. Through the latter half of 1999, economic indicators suggested that we had underestimated economic growth. The projections for price and cost inflation in the mainland economy over the next few years were revised up. This was why Norges Bank, following its monetary policy meeting on 16 March 2000, at which interest rates were left unchanged, signalled for the first time that the next interest rate change was more likely to be an increase. On 12 April 2000, Norges Bank decided to increase the sight deposit rate by 0.25 percentage point to 5.75 per cent. The decision to raise our key rates was taken in a period when the krone had depreciated against an average of trading partners' currencies, but was stable and strong against the euro, primarily reflecting the weakness of the euro. Given the prevailing situation in the Norwegian economy, we were of the view that an unchanged interest rate would not contribute to bringing price and cost inflation down  BIS Review 7/2001  7  towards the corresponding aim for inflation of the ECB. An unchanged interest rate would therefore undermine the objective of a stable exchange rate over time.