samchain/econo-pairs-v1 huggingface dataset:
With lower oil prices, the economic outlook will deteriorate, but the overall effect on inflation of a marked fall in oil prices and a weaker krone is not clear cut. 8  BIS Review 139/2009  The sharp decline in activity among trading partners has reduced demand for Norwegian export products. The decline in Norwegian exports has occurred slightly later and been somewhat more moderate than observed in a number of other countries. After a sharp fall in exports in the first half of 2009, foreign trade statistics indicate that traditional merchandise exports have increased somewhat this autumn. Norges Bank’s regional network reports that the export industry is expecting approximately unchanged activity over the next half-year. The cost level in the Norwegian business sector is now about 15 per cent higher than the average for the period since 1970, measured in terms of relative wages in a common currency. Since wage growth is higher in Norway than abroad, relative costs will rise ahead even if the nominal krone exchange rate should remain unchanged. This will put many Norwegian firms in a demanding position in terms of international competition, which may influence location decisions ahead. Export growth is expected to pick up ahead, but at a slower pace than expected market growth abroad. The contraction in private investment has been somewhat more moderate in Norway than in a number of other countries over the past year, even though business investment also dropped sharply in Norway.

Norges Bank has also announced that the share of a bank’s borrowing facility that can be based on collateral in the form of bank bonds will gradually be reduced. Covered bonds will continue to be eligible as collateral. Mainland GDP increased in Q2 after two quarters of negative growth. Growth was somewhat higher than expected, reflecting solid growth in public sector demand and private consumption. In September, Norges Bank’s regional network contacts reported that activity had edged up in Q3. The main contribution came from industries providing goods and services to households and the public sector. Despite a moderate rebound in both domestic and international activity, prospects for manufacturing and the building and construction sector remain relatively weak. After falling for a long period, manufacturing production picked up again in July and August. The decline in new orders and order reserves, in the shipbuilding industry among others, nevertheless indicates a low manufacturing production level in the period ahead. According  BIS Review 139/2009  7  to the regional network, manufacturing production is expected to remain unchanged over the next half-year. Overall production in the building and construction sector is also expected to remain virtually unchanged, with increased activity in the construction sector underpinning production. Enterprises in the service sector expect production to pick up over the next halfyear. Regional network enterprises in the retail sector report that production is rising and expect continued growth ahead. The petroleum sector is having a stabilising effect on overall demand via new investment, maintenance and operations.
10  Government Bill 01/02:167, "Changes in the Competition Act for more efficient combating of cartels, etc.". BIS Review 25/2002  5  registered in a special product register containing information on the exact contents also hampers import competition as most other countries do not have such registers. The fact that the Swedish market is small means that it is not economically viable for foreign manufacturers to make the adaptation required by Swedish rules or legislation. The existence of recycling systems for cans and bottles also makes import competition more difficult in the soft drinks market (soft drinks are approximately 40 per cent more expensive in Sweden than the rest of the EU). The fact that requirements motivated by concern for the environment could impede competition does not, of course, mean that they should be abolished. On the other hand, this is a good argument for coordinating the various regulatory systems in Europe. The bank sector  As I am today speaking to people who work in the bank sector, I thought I would take the opportunity to say a few words on competitive conditions in this sector. The bank sector was characterised by extensive regulations right up until the mid-1980s, which acted as an impediment to dynamic development in this sector. Few new operators could enter and competitive pressure was fairly low. However, the deregulation that has occurred since then has radically changed this picture.

At the moment, a German low-price retail chain is planning to establish itself on the Swedish market, which could have a dampening effect on prices. A high concentration of companies also increases the risk of forming cartels. Recently, several cartels, or suspected cartels, have been revealed in the building, aviation and petrol trades. According to a recently published SIFO survey, 80 per cent of small companies in Sweden and 50 per cent of large companies state that they believe cartels arise very often or quite often in Swedish trade and industry. In other words, consumers may be losing considerable sums of money. With regard to the "petrol cartel", amounts in the order of half a billion kronor were discussed. By eliminating market mechanisms, companies also avoid the competitive pressure that could otherwise ensure they make their operations more efficient and develop new products. In the long term, it also leads to a loss of competitiveness from an international perspective, lower growth and fewer jobs. The government has proposed measures against unlawful co-operation in the bill on combating cartels 10 that was put forward recently. The bill aims to make the war against cartels more efficient by allowing a company that exposes a cartel in future to avoid paying the fine for damage to competition or to have its fine reduced. The government also proposes a stronger confidentiality protection for those who report or provide information on cartels.
This has raised other issues of rotation of auditors to prevent cozy relationships undermining the integrity of the audit. A periodic change of the firm might have led to more serious questioning of the accounts. Further, some US firms have announced plans to include, as an expense, the cost of executive stock options. The changes aim to more accurately describe the revenues and costs associated with companies’ primary business. And Standard and Poor’s has introduced new benchmarks for reporting corporate earnings. These are all positive examples of participants working together to enforce the spirit of the rules under which financial markets operate. What has been done recently in Switzerland to improve the transparency of Swiss financial markets? Some efforts have already started some time ago. Most notably, the Swiss Exchange and the Swiss Business Federation “economiesuisse” co-ordinated their efforts to develop two sets of rules which became effective on July 1, 2002: The “Swiss Code of Best Practice” and the “Directive Concerning Information on Corporate Governance”. This will hopefully lift the standards for corporate governance and improve the level of transparency for the publicly traded firms in Switzerland. We have also seen political initiatives aiming at more transparency in remunerations. Business uncertainty It would be shortsighted to believe that the recent stock market reaction has only been the result of misconduct and the lack of corporate governance. The world economy is still digesting the consequences from the deep retrenchment in capital spending, which started in 2000 in the high-tech and the telecommunications sectors.

The Paris financial centre and French public and private players have a recognised lead here, but they must consolidate it in a context of active competition. We will publish the scenarios by the end of March, and conduct the tests by December. I should point out that the results of this ground-breaking exercise will be published on an aggregated and anonymous basis. ** A word of conclusion on the Banque de France. Like you, we need to adapt, from payments to digitisation or cybersecurity. Our determined approach to innovation allows us to improve our performance and responsiveness. 2020 is the final year of our current strategic plan, through which we have reduced our headcount by more than 20% and our current expenses by more than 10% in five years. We will continue our transformation through 2024. We owe it to the people of France; but we also owe it to you, who are the leading players in the financing of our economy. Happy New Year to you, your staff, and our country. 3/3  BIS central bankers' speeches
There are no sharp dividing lines between these horizons. Nonetheless, the time horizon imposes various requirements on economic theory and models for our purposes. The starting-point for the analyses is important. Current statistics and anecdotal information can serve as a basis for providing some indication of how the economy has evolved up to the present. But the information set is uncertain. Statistics are published with a lag and are often revised. Data from different sources can provide different pictures of the situation at hand. Statistical models can provide us with good support and help distinguish between news and noise in the data. They can capture time series properties in data and correlations that in many cases will be able to produce good forecasts of developments in the months ahead. There are certain similarities between projecting developments in the Norwegian economy in the coming months and forecasting the weather. Meteorologists have observed that averaging forecasts from a large number of models generally produces more accurate forecasts. To project consumer price inflation in the coming quarters, the Bank has developed a system for averaging forecasts from about 170 different statistical models, all of which are intended to project inflation in the Norwegian economy in the very near term.3 The model weights are determined on the basis of historical accuracy and are continually adjusted so that models with better predictive power are given greater weight in the  3  The models are grouped into three classes: factor models, indicator models and VAR models.

When we set the interest rate, we give weight to both the current situation and the outlook two to three years ahead. The statistical models help us understand the current situation, while the equilibrium properties frame the analysis. NEMO describes how the interest rate can be set to bring the economy from its current starting-point back to the long-term equilibrium path. As a support tool in making monetary policy decisions, such a model apparatus is thus particularly relevant. I will come back to the main features of NEMO later. As I mentioned earlier, Norges Bank operates under a formal monetary policy mandate. The Bank’s objective is to stabilise inflation and provide the economy with a nominal anchor. As a minimum, an economic model to be used as support for interest rate decisions should be based on the assumption that monetary policy can steer inflation. Economic agents can be expected to look ahead when making consumption and investment decisions. It is not only current economic policy that is likely to matter to them, but also what they expect it will be in the future. Expectations must therefore be incorporated and play a role in a monetary policy model. 4  BIS central bankers’ speeches  Many economists previously held the view that unemployment could be reduced by accepting slightly higher inflation over time. Monetary policy was oriented accordingly and inflation accelerated in many countries, without a sustained decline in unemployment. It turned out that bringing rising inflation under control involved substantial real economic costs.
In this environment, it is imperative for policymaking to also be agile and pragmatic. One aspect of pragmatism is the need to be bold and timely in introducing new policy tools, even unconventional ones when it becomes necessary. When a new crisis occurs, it is likely that the factors causing it are unprecedented. It goes without saying, that the solutions required to remedy the problem requires new measures as well. Using conventional and ‘consensus thinking’ are unlikely to be an effective remedy. Policy-making is also increasingly characterised by shorter time horizon. With the rapid developments in the financial markets, the window of opportunity and effectiveness for policy has shrunk considerably. Gone are the days when policy-making can take months to formulate and implement, let alone years. As financial markets evolve, the shelf-lives of policies have also become shorter as policies can become ineffective very quickly. Such an uncertain environment necessitates the deployment of new and untested policies. The “audacity of pessimism” – as Mervyn King calls it – a situation when policymakers start scrambling to address problems only when things have gone terribly wrong – may prove too little too late to salvage the situation. Constant, holistic and courageous assessments of implemented policies are therefore crucial in ensuring that policies remain relevant. Another area of policy pragmatism that seldom gets discussed is the ability and conviction in reversing policies when deemed appropriate.

Christine Lagarde joined the French government in June 2005 as Minister for Foreign Trade. In June 2007 she became Minister of Economy and Finance, being the first woman to hold the position of Finance Minister of a G-7 country. From July to December 2008, she also chaired the ECOFIN Council. In 2009, Financial Times ranked her as the best Minister of Finance in the Eurozone, considering both her excellent work within the French government and her involvement in the management of the financial crisis. Madame Lagarde acted with diplomacy as Chairman of the G-20 when France took over its presidency for the year 2011. All these achievements in her current position led Forbes Magazine this year to rank her among the most powerful and influential women in the world. Besides her contribution to official matters, Madame Lagarde has broader interests and is involved in various fields of expertise as well as global issues. For example, she has signaled the major risk in not addressing climate change saying with humor: “Our kids will be grilled, fried, toasted and roasted.” She also militates for encouraging women to seek education and enabling them to be more independent and provide for themselves and for their children. Christine Lagarde is Chevalier de la Légion d’honneur since July 2000, and Commander of the Order of Mérite agricole. She has an Honorary doctorate from Katholieke Universiteit Leuven (Belgium). Madame Lagarde will address you today on a thought-provoking topic: Eastern Europe and Romania: The Path to Prosperity.
We don’t see many positive effects from the ECB’s policy in other ways either: economic growth is fragile at 1.5%, unemployment stands at 10%, with youth unemployment as high as over 20%. You can’t really give the ECB good marks for that? If the ECB had not taken the measures that it did, we would be in a depression; I’m convinced of that. And a depression would be much worse than what we are experiencing today and worse than what we went through over the past decade. Let me recall: after the banking crisis, we had a severe recession in 2009 and the economy then recovered in 2010 and 2011. This was followed by the debt crisis – centring on the sovereign debt of several European countries – which plunged the European economy into another recession. This recession was not as deep as the one in 2009 but it did last longer, because it took us two years to get over it. Economic growth picked up again somewhat at the end of 2013 and in 2014, but as of the spring of 2014 we saw another slowdown in growth and were at risk of running into a third recession. In January 2015, ECB President Mario Draghi announced that the ECB would pursue a policy of quantitative easing: we now print money and pump it into the economy in order to help ease credit conditions. Were it not for the monetary policy of recent years, we would certainly have landed in a deep recession.

I welcome the proposal to strengthen the role of CBIs. It would reinforce coordinated supervision, while reflecting the responsibilities of the ECB – as a CBI – within the supervisory framework. The role of the central bank of issue Background and rationale for the ECB recommendation However, although EU legislators can incorporate a role for CBIs into the processes for supervising CCPs, the regulation cannot go so far as to confer on the ECB the sort of binding instruments this enhanced role requires, which the ECB thought it had until challenged in court by the United Kingdom. In 2015, the General Court held that the ECB does not have the competence to regulate the activity of securities clearing systems, including CCPs. Moreover, the Court stated that the ECB would need to request an amendment to Article 22 of the Statute of the ESCB and of the ECB, which already enables the ECB to make regulations for clearing and payment systems, if it considers this necessary for the proper performance of its tasks under the Treaties2. 2/5  BIS central bankers' speeches  The ECB’s Governing Council therefore unanimously adopted a recommendation to amend Article 223 to extend it to cover derivatives, give legal effect to the ECB’s role under EMIR, and give the ECB the flexibility and autonomy to act outside EMIR where clearing would pose a severe threat to the stability of the euro. Amending Article 22 of the Statute – procedure Let me briefly explain the procedure for amending the Statute.
Up to autumn 2008, it appeared that capacity utilisation in the Norwegian economy would most likely decline to a normal level, inflation would stabilise around 2½ per cent and the key rate ahead could be held at what we consider to be a normal level – between 5 and 6 per cent. But the outlook was regarded as uncertain. Commodity prices rose and pushed up inflation in many countries. At the same time, wage growth in Norway had become high and productivity growth was slowing. On the other hand, the financial turbulence, if it gained momentum, could have a severe impact on the global economy and our exports. Then, in autumn 2008, the turbulence led to a synchronised financial and real economic crisis in virtually every country in the world. As a result, output and employment are falling, and Norway is no exception. The way forward Since then, the authorities in many countries have shown that they are prepared to use powerful tools to fight the crisis, but financial markets are still under stress. The crisis of confidence and credit rationing are leading to a decline in output. Corporate earnings are falling across the board and the number of unemployed is rising, prompting new rounds of losses on securities and in banks’ books. Every week there is a news story conveying the impression that the action being taken is not enough to stave off the downturn. But the measures being implemented are indeed having an effect.

9  7  Janet L. Yellen, “Recent Developments and the Outlook for the Economy,” Remarks at the City Club of Cleveland, July 10, 2015. 8  Paul Krugman, “The Myth of Asia’s Miracle,” Foreign Affairs, Vol. 73, November/December, pp. 62–78, 1994. 9  Enrico Moretti, The New Geography of Jobs, Mariner Books, 2013. 4  BIS central bankers’ speeches  For instance, the reason why Seattle, Washington, became a high-tech industry hub depended to a large extent on the fact that the founders of Microsoft had grown up there and wanted to relocate their company to a place familiar to them. Similar stories can be found for other U.S. high-tech cities. If these cases provide a complete explanation of productivity growth, all we can do is wait and hope for a genius like Bill Gates or Steve Jobs to be born by chance in our country. Fortunately, however, economic literature is much more hopeful in this respect: productivity is largely endogenous. IV. How to raise productivity  In the economic literature, there is a long list of factors that are thought to have a positive impact on productivity growth. I do not intend to go through all of them but, instead, I would like to focus on three things that I think are of particular importance. The first is human capital. Measuring human capital is a difficult task, but one of the simplest indicators often used is the number of school years.
In addition, the lowest permitted level for total Tier 1 capital is raised from four per cent to six per cent. Basel III also introduces a capital conservation buffer of 2.5 per cent, consisting of Core Tier 1 capital. This means that the banks should have a Core Tier 1 capital holding of at least seven per cent. If a bank falls below the seven per cent limit, its entitlement to pay dividends and to conduct share buy-backs will be restricted. The proportion of profits that must be retained within the bank increases the further below the seven per cent limit the bank goes. The idea behind this is to force the banks to accumulate their profits as capital instead of paying them as dividends to the shareholders. However, this will not affect Sweden, at least not directly. Swedish banks are well capitalised and have a quota for Core Tier 1 capital that is already above seven per cent. We will, however, see effects at the international level and, as we are highly affected by what happens abroad, Swedish banks and Sweden in general will also benefit from the fact that banks in other countries will become more resilient. Apart from the changes in levels, there are also stricter requirements regarding the quality of the capital held by the banks. As equity constitutes the difference between assets and liabilities on the balance sheet, both the size and quality of the capital will be highly affected by how a bank’s assets and liabilities are valued.

Peter Praet: The role of the central bank and euro area governments in times of crisis Speech by Mr Peter Praet, Member of the Executive Board of the European Central Bank, at the German Federal Ministry of Finance, Berlin, 19 April 2012. *  *  *  I would like to thank Maximilian Freier and Gianluigi Ferrucci for their contribution in the preparation of this speech. Introduction Since 2007, we have constantly been confronted with exceptionally tense financial and economic conditions. When the tensions in the financial markets first emerged in the summer of 2007, they were perceived as a liquidity shock. However, the collapse of Lehman Brothers in September 2008 – the first climax of the crisis – revealed more fundamental fragilities in the global financial system. The accumulated credit excesses, paired with the complex cross-country linkages in the financial markets, quickly exacerbated the financial market tensions on the other side of the Atlantic, transforming them into a crisis of global dimensions. The resulting Great Recession of 2009 affected virtually all industrialised countries and caused other weaknesses in the economic and financial system to be crystallised. Specifically, the severe economic contraction worsened the fiscal positions in many countries around the world, particularly in those that already had sustained public or private debt imbalances before the crisis. The subsequent tensions in some sovereign debt markets have spilled back into the financial markets. As safe assets, sovereign bonds play a key role in financial systems.