samchain/econo-pairs-v1 huggingface dataset:
Population aging implies a continued decline in the proportion of the working-age population, which in turn poses a challenge to sustaining per-capita income growth, as a given income earner has to transfer a larger share of his or her income to the retirees. Chart 5 shows how diverse the region is in this context, with some countries already facing serious challenges. In this chart, the horizontal axis is changes in working-age population, and the vertical axis is the proportion of the working-age population to the total population. A rise in this proportion is often called a “demographic bonus,” while the opposite is called a “demographic onus.” And the size of the bubble is proportional to the absolute number of the working-age population. As you can see, over such a long period of time, even glacial demographic changes seem dramatic. Japan has already entered deep into the period of demographic onus, with the absolute number of the working-age population declining at a significant pace. The NIEs, China and some ASEAN countries are about to follow Japan in this regard in the not-sodistant future. Meanwhile, India and other Asian countries are expected to enjoy a favorable demographic environment at least until the middle of this century. The third challenge is what I call the “Malthusian trap.” In Malthus’ original work, the existence of a limited resource – land in his case – constrains growth. Likewise, limitations in the supply of natural resources, such as oil, are thought to threaten global growth in the longrun.

In addition to surveys, international organizations have mobilized to develop a range of indicators to assess the different dimensions of financial inclusion. Since the Cannes Summit in 2011, the G20 has focused on developing financial inclusion indicators, including indicators on access to and use of financial services, financial literacy, and the quality of financial service provisioning and consumption, as part of a continuous reflection process integrating new international trends in this field, notably the development of new distribution models and the emergence of digital financial services. The AFI also published a set of basic indicators on access to and use of financial services in 2013 and on quality in 2016 with the aim of harmonizing data among its members by providing them with a common tool to ensure comparability and foster peer learning. Ladies and gentlemen, In Morocco, since 2007 both the Ministry of Finance and Bank AlMaghrib have considered financial inclusion as a major instrument to develop a comprehensive strategy of the financial sector by 2020 which aims to deepen the national banking market, develop capital markets and position our country as a regional financial hub. Through our commitment to the Maya Declaration in 2013, we announced our pledge to promote access to and use of quality financial services based on sound and solid foundations. That same pledge was 4  reaffirmed in 2016 as part of the roadmap of aligning the Moroccan financial sector to sustainable development goals at the COP 22 held last year in Marrakech.
The balance financial intermediaries are regulated by various authorities while some are not regulated at all. Banking companies in Sri Lanka come under several jurisdictions, but the Banking Act is the centrepiece for financial regulations. It sets out all necessary regulatory provisions for capital requirements, shareholder limits, credit operations, provisioning requirements, consolidation, acquisition and mergers, suspension, winding up of banking companies, etc. Sri Lanka’s banking sector is currently operating on Basel I, but getting ready to implement Basel II Capital Adequacy Ratios from early 2008. Basel II is basically risk mitigation in banking operations and, it allows supervisors and regulators to encourage or require banks to build up capital buffers in good times. Financial regulations have thus been set taking into consideration the cyclical situation which banking firms face in home and host countries. In addition to the provisions in the Banking Act, the Monetary Law Act which governs the operations of the Central Bank, also provide for regulation of banking companies. However, in recent times, through various amendments, most of the provisions of the Monetary Law Act have been incorporated in the Banking Act. Their stock market operations come under the purview of the SEC Act. In addition to the banks, the Central Bank regulates the finance companies under Finance Companies Act and the leasing companies under the Leasing Act. The primary dealers who deal in the government securities market irrespective of whether they are banks or not, are under the supervision of the Central Bank.

They have also made some progress in improving their international competitiveness, though there remains an opportunity for further structural reforms in labor and product markets – and not just in the periphery – to increase productivity and strengthen long term growth prospects. The European Central Bank’s (ECB) introduction of the outright monetary transactions (OMT) program has reduced financial market tensions considerably in the peripheral countries, so that sovereign debt funding costs in those countries are at more reasonable levels. The risk that interest rates in the periphery could spiral upward has been significantly diminished. Also, the commitment to European integration remains strong, a factor that U.S.based analysts and investors do not always sufficiently appreciate. Over the past few years, when the situation has been the most bleak, the choice in favor of the Union with the euro at its core has always won out. The bad news is that the eurozone is still in a recession and the political support for further rounds of budget-tightening has clearly lessened. The eurozone financial system is being fragmented and the partial easing of pressure on peripheral sovereign debt markets has not translated into a corresponding easing in private-sector borrowing costs in these nations. If growth does not resume relatively soon, then the political support for continued fiscal and structural adjustment could further erode. In Europe, a key challenge is to strengthen the economic foundations of monetary union at the system level.
Strong international cooperation and collective support from member Central Banks and regulatory authorities of the IFSB and global institutions, as well as the strong connectivity with other international standard setting bodies and relevant organisations would ensure continuous close engagements that would allow the attainment of balanced views. The IFSB has had a key role in shaping the global Islamic financial industry, with a decade of achievements that have provided a solid foundation for the progressive growth of Islamic finance that is underpinned with stability. Significant contributions have been made by the IFSB in realising the recommendations in the eight building blocks identified in the Islamic Finance and Global Financial Stability Report 2010, particularly in the areas of prudential standards and liquidity management. It is encouraging that the cross-sectoral prudential standards issued by the IFSB since 2005 have now been implemented in nine countries and more are expected to follow as we progress forward. These standards have taken into account the distinct characteristics and specificities of Islamic finance. The effective implementation of these standards contribute to promoting the soundness and stability of Islamic financial institutions. There has also been strong support by the IFSB for its members  BIS central bankers’ speeches  1  to effectively implement the standards through technical assistance that aims to enhance juridictional preparedness in adopting the standards.

The aspirations of ten Central Banks and the Islamic Development Bank – was to lay the foundation for the development of a sound and stable Islamic financial system that will pave the way for its successful integration as a viable and credible component of the global financial system. A decade later, the IFSB has build a solid international reputation as a credible standard-setting body for Islamic finance, with the IFSB charting its achievements in increasing regulatory cooperation, encouraging uniformity of regulatory frameworks and enhancing the monitoring of financial risks in the Islamic financial system. The current global landscape of the Islamic financial system, with enhanced stability and resilience that has contributed to the vibrant growth and internationalisation of Islamic finance is a realisation of the aspiration and vision of the IFSB Founding Members. The efforts are largely attributable to the unwavering commitment and dedication of the members of the IFSB that have relentlessly pursued the goals. The increasing support for the IFSB, signified by its continuous growth of membership over the decade would ensure a progressive continuity in the work of the Founding Members. There are now 187 members from 43 jurisdictions. Malaysia is honoured to host the IFSB here in Kuala Lumpur, and is committed to provide full support in the journey to achieve a sound and resilient Islamic financial services industry.
A gradual increase in the repo rate, where the policy is brought step by step onto a less expansionary path, in my opinion reduces the risk of a development that would lead to abrupt adjustments in house prices and household indebtedness later on. This also thus reduces the risk of an unfavourable development of the real economy 3 . In this context, I would, however, emphasise that the reference to household indebtedness and house prices is not, as some have understood it, an expression for our having introduced new targets alongside the inflation target. There are though, as I have just explained, reasons to take into account the impact of these factors on the real economy and inflation, even in a longer perspective, and under different designs of monetary policy. Uncertainty over the future repo rate path We thus always try to be as clear as possible about our view of future macroeconomic developments, including the monetary policy with which this development is normally associated. One question that therefore deserves a comment, before I finally go on to discuss current moentary policy, is how accurately is the future repo rate depicted by market expectations as expressed in implied forward rates? It is important to remember that our view of the development of the repo rate at the monetary policy meetings is based on the information available at the time of the decision. Our considerations may, of course, subsequently be changed due to new statistics becoming available or to the economy facing unforeseen shocks.

Inflation can be expected to be somewhat higher than this forecast for some time to come due to the higher energy prices, although, it is a matter, as I see it, of changes in a rather short time perspective. However, as we have earlier pointed out, there is also reason to assume gradually increasing inflationary pressures as the economic upswing leads to a rise in capacity utilisation both in Sweden and abroad. The basic assessment of inflation developments over the next few years still stands, given the new information received since the Inflation Report. My overall conclusion is that the new information received since the Inflation Report in February mainly confirms the picture then outlined of economic activity in Sweden, while it indicates a slightly stronger development abroad. Inflation prospects in the next few years also appear to have held up rather well on the whole. In February, when we chose to raise the repo rate, our conclusion was that the interest rate should perhaps be increased at a somewhat slower rate than was anticipated according to the interest rate path on which the forecasts in the Inflation Report were based. Personally, I do not see any reason in the current situation to change that assessment, although international developments now look slightly better than we had anticipated in February. This is something I will discuss with my colleagues when we meet next week.
Allow me to return to the first topic of the day and say a few considerations about Artificial Intelligence, Machine Learning and Big Data. The interconnected use of new technologies is 1/2  BIS central bankers' speeches  already a common practice in many operational fields, such as the defense industry, the automotive industry or the healthcare sector. It is, therefore, natural that new technologies would penetrate the financial sector. Their applications are diversified in design and scope, examples of which are: algorithmic trading, portfolio optimization, scoring and pricing models. Moreover, the use of these new technologies receives more and more attention in the financial and economic areas, as the transition from classical banking sector products and services is growing exponentially. In this context, the focus moves from the individual to more general issues and the question arises about the effects that the trinity described by artificial intelligence, machine learning and big data analytics, have on the financial system. Implicit answers to this question are formulated as considerations of financial stability. In other words, the key question is related to the costs and benefits that the new technologies listed above have on financial stability. The answers to this question are quite varied, given that this issue has not been thoroughly investigated up to this moment. Among the best-known benefits, some of the areas where progress can be made by using the specified technologies are: regulatory compliance, systemic risk monitoring, fraud detection and supervisory effectiveness.

However, in recent years, I have seen that there has been an increasing interest in this matter and in other issues, once considered exotic for central banking. Let me give you two examples. First. A few years ago, at a Central Banks’ Governors’ Club of the Central Asia, Black Sea Region and Balkan countries meeting in Shanghai, there was a presentation about the role the central banks could play in reducing pollution. Second. Early this year, in Bruges, within the IMF Dutch-Belgian Constituency, the National Bank of Belgium gathered central bankers to discuss policy challenges related to doing business in the digital era. So, it is not a real wonder that we talk today about Artificial Intelligence here, in Bucharest, at the National Bank of Romania. It is good for central banks to review from time to time what they are doing. As Agustin Carstens, the head of the Bank for International Settlements, has recently said that central banks are ‘acutely aware of the need to adapt’ their frameworks. That opens the way to new ideas, such as allowing inflation to temporarily overshoot to compensate for past years of weak price growth. I will not go into detail regarding inflation and all the variables that allow us to acknowledge and deal with it. Deputy governor Liviu Voinea thoroughly addressed the inflation puzzle and the present whereabouts of Phillips Curve, during dinner last night.
Norman T L Chan: Excessive leverage – root cause of financial crisis Speech by Mr Norman T L Chan, Chief Executive of the Hong Kong Monetary Authority, at the Economic Summit 2012 “Roadmap to Hong Kong Success”, Hong Kong, 9 December 2011. *  *  *  1. Following the outbreak of the Global Financial Crisis in 2008, it is now generally recognised that serious imbalances in the global economy have been built up over the past 10–20 years. There are many different theories on how these imbalances came about and on their contributions to the Global Financial Crisis. A commonly held theory in western countries attributes the global imbalances and the financial crisis in the US and Europe to the so-called “savings glut” in the Emerging Market Economies (EMEs), especially China. In other words, the problems and miseries being experienced in the US and Europe arose because the EMEs not only over-exported, over-saved and under-spent, but also have been lending moneys at very low rates to the industrial economies and have financed the consumer booms and fuelled the credit and asset bubbles there. I do not subscribe to this view. However, given the complexity of the global financial system, it is very hard to try to come up with a grand theory that can fully explain what has gone so badly wrong that it has resulted in the worst Global Financial Crisis since the World War II.

BIS Review 133/2010  11  When assessing the external demand outlook, it is important to consider our trading partner’s headline growth forecasts as well as the composition of growth. In this respect, it is noteworthy that the latest Consensus Forecasts release indicates a noticeable change in the composition of the euro area 2011 growth forecasts. More specifically, along with the depreciation of the euro owing to financial distress and the weaker growth outlook, euro area private consumption and investment forecasts have been revised downwards, thereby emerging as a potential factor to affect our external demand prospects adversely (Table 2). In other words, despite the absence of a major revision in euro area growth forecasts, the change in the composition of GDP growth indicates a weaker external demand outlook for Turkey compared to the previous Report. Although weak external demand restrained recovery in industrial employment, the steady recovery in the labor market continued in the last period and non-farm employment posted a significant rise in the last one-year period fuelled by the steady increase in employment in construction and services sectors (Figure 30). The continued rise in labor force participation rates in the first quarter of 2010 curbed further decline in unemployment rates. Unemployment rates fell markedly in April amid increased employment and reduced labor force participation (Figure 31). Leading indicators imply that the recovery in non-farm employment will continue, albeit slower.
Behind recent trends, in fact, lies the emergence of countries like China and India, who have doubled their share of global output over the past twenty years and are now also competing in markets for high technology products. China alone manufactures half of the world’s cameras and its share of world exports of computers increased tenfold, to almost 20 per cent, in the ten years to 2003! We, too, must find a way to participate actively in globalization and gain from it. ... compounded by a sharply higher oil price ... The second challenge derives from the sharp increase in oil prices. There is a silver lining to this dark cloud in the sense that the price rise is not expected to have a significant effect on world output. The IMF, for example, anticipates global growth to average 4.3 per cent both in 2005 and 2006. This is mainly because it is due to an expansion in demand that is underpinned by economic growth, particularly in Asia. It is still the case, however, that a massive redistribution of wealth is underway from countries which consume oil to those which produce it. Malta is inevitably on the losing side of this process. The estimated increase in the fuel bill for 2006 arising from the production of electricity and the consumption of liquid fuels is not far from the expansion in nominal GDP forecast for 2005.

In the five years to 2004, the annual growth rate averaged only 1.2 per cent in real terms, well below that of many of our EU partners; and while this year’s growth rate up to September, at 1.7 per cent, may be encouraging, it is too early to know whether the implied acceleration will be sustained. And yet the need to achieve a faster pace of economic growth has probably never been as urgent as at the present time. Growth is not only necessary in order to satisfy society’s legitimate aspirations for higher living standards. Beyond that, an expansion in the economy’s supply capacity and an enhanced degree of international competitiveness are essential to overcome the daunting challenges the country is currently facing. A threefold challenge: globalization and its implications The first challenge derives from the pervasive process of globalization, which, powered by rapid advances in technology and trade liberalization, has given rise to an unprecedented mobility of resources between countries in pursuit of the best cost-quality combinations. Suffice it to say that over the past two decades exports and foreign direct investment have been growing twice and three times faster than global output, respectively. Globalization is undoubtedly creating numerous profitable business opportunities. At the same time, however, it represents a potential threat for open economies like Malta’s because of the concurrent intensification of competition.
I should note that the Review uses data that was available up to 5 May 2006. In my presentation (some of the slides), I will refer to developments since this cut-off date. In presenting the main findings of the analysis, I will broadly follow the structure of the Review (as outlined on slide 2). 2. Overview of the main risks and vulnerabilities  I would like to begin with an overview of some pertinent developments in the euro area financial system and of the main sources of risk and vulnerabilities for euro area financial stability, in comparison to the assessment in the December 2005 Review. Overall, the developments since last December lend support to the view that the euro area financial system is robust and well-capable of withstanding shocks. First, the pace of global economic activity has strengthened and it has become more evenly distributed. Second, the balance sheets of euro area banks and insurance companies have continued to strengthen. At the same time, these positive developments are clouded by the fact that the risks and vulnerabilities we identified in the December 2005 Review remain and some of them have increased. Global imbalances have continued to grow. Moreover, it cannot be excluded that tightening liquidity conditions in the G3 economies could yet expose vulnerabilities in the pricing of assets following a protracted period of hunt for yield in a low interest rate environment. Particularly at risk are leveraged investors, especially hedge funds, and this could accentuate the risks of disorderly market corrections.

The price-earnings ratio of the euro area stock market (shown on the left of slide 8) indicates that despite the rather elevated level, this valuation measure remains well below its peaks reached in 2000. However, should corporate earnings growth unexpectedly slow down, the consequent rise in price-earnings ratios could make stocks look relatively expensive to other assets. The chart on the right plots the implied volatility of euro area stock prices and corporate bond spreads which both gradually declined throughout the first five months of the current year, despite rising longterm bond yields. The rather sharp jump in these indicators during the last two weeks, suggests that there was room for adjustment to a higher pricing of risk in the context of changing views regarding the future macro-financial environment. Before discussing the developments in euro area financial institutions, let me first highlight an important dimension of the market-based intermediation process: the rapid development of structured finance products. Although the risk-transfer that this market has facilitated has very likely led to efficiency gains and a better management of risks within the financial systems, there are several concerns which mostly arise from the fact that relatively little is known about how this market has effectively spread risk and how it would function in a situation of extreme stress. Since June 2002, the size of the global credit default swaps market has increased nearly exponentially (see chart on the right on slide 9).