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Foreclosure rescue scams that have taken up residence in nearly every community appear to be even more prevalent in stronger market areas where retaining title to a home is more economically feasible. One counselor in Los Angeles told me that as many as 80 percent of the homeowners she counseled had been victims of rescue scams. 1 Mallach, Alan.

The headline CPI number was, however, a bit lower than we had previously expected, reflecting the decline in petrol prices that started late last year. We expect headline inflation to decline further this year as the full effect of lower petrol prices shows up in the figures.

Moreover, the enormous toll on household wealth resulting from the collapse of house prices – almost a 35 percent decline from its 2006 peak, according to the CaseShiller index – imposes ongoing restraint on consumer spending, and the loss of home equity has impaired many households’ ability to borrow.

Through this initiative, BPNG and the commercial banks are transforming PNG’s banking system to the equivalent of that of already developed nations such as Australia, New Zealand and Singapore. The new system will facilitate greater use of electronic banking and reduce fraud and by improving electronic payment facilities, there will be a reduction in the amount of time people wait in queues.

As stability between the exchange rates of those currencies increased through the late 1990s and then became absolute in January 1999, some investors were induced to substitute into dollars to regain the diversification they had lost as the euro-area currencies became more closely correlated. We are left with the question of how the international role of the euro will unfold.

First, a word on the financial sector’s scope and scale: - Financial assets grew by 70% over the past five years and in CY05 reached Rs 5.1 trillion $ 85 billion), equivalent to 80% of GDP; - The banking sector grew at a faster pace relative to non-bank sectors and accounts for 71% of the financial industry assets; - Market capitalization of the stock exchange grew steadily and recently peaked at 44% of GDP relative to 10.3% in June FY00 Latest Financial Sector Assessment for Pakistan and the Banking Sector Review 2005 1 , which will be released by July 2006, together lend comfort that: (i) Banking sector profitability (after tax), at over $ billion, is at an all time high and the return on assets (after tax) increased to 1.9 % in CY05 2 from 1.2 % in CY04; surpassing the relevant international benchmark.

While fiscal policy was pro-cyclical in Portugal, reinforcing domestic demand pressures, it was much more disciplined in Ireland. While growth in unit labour costs and HICP inflation was high in Portugal (7.6% and 6.2% on average between 1990 and 1998, respectively), cost and price pressures remained contained in Ireland (1.4% and 2.3%, respectively).

Competitiveness was hurt in Portugal, resulting in a rising current account deficit (to 8.9% of GDP in 1999), while competitiveness was relatively well preserved in Ireland and the current account position broadly neutral (0.3% of GDP in 1999). Thus, the longer-term track record before joining monetary union regarding low inflationary pressures and a balanced current account was impressive in Ireland.

* * * The European Systemic Risk Board (ESRB) will be established in January 2011 as the body responsible for the macro-prudential oversight of the EU financial system. It is mandated to actively monitor the various sources of risk to financial stability in the EU – across Member States and financial sectors – with due consideration of also global developments.

It should identify the risks and assess how they could impact the financial system so as to prioritise them.

Banks and insurance companies must comply with very different minimum capital requirements - requirements that are tailored to their businesses.

Some of these and many similar issues facing customers would have emerged from the root cause analysis which I alluded to a little earlier paving the way for banks to take corrective action.

This all means that, as APRA Chair John Lonsdale said last week: Australians can be confident that ‘their banking system is among the strongest and most resilient in the world, with prudential safeguards above and beyond minimum international requirements’.

Graph 3 Banks' Capital and Liquidity % Capital* Liquidity coverage ratio % Tier 1 capital ratio 12 150 8 100 CET1 capital ratio Regulatory minimum 4 50 0 0 2012 2017 2022 2018 2022 * Break in March 2013 due to the introduction of Basel III.

Our discussions with APRA and other agencies on these matters are ongoing, and there will be more to say about them in due course. For now, my colleague and I will be happy to take any questions that you might have. BIS central bankers’ speeches 3

Our aim in setting out these principles is to provide market participants with the framework in which to think about how they, for example, handle their orders. The emphasis here is very much on the word ‘think’. 1/6 BIS central bankers' speeches These principles of good practice have helped to restore confidence and promote the effective functioning of the wholesale FX market.

Among other things, it will tend to weigh on growth of economic activity, labour force participation and the public purse. It may weigh on productivity growth to the extent that it leads to less risk-taking and innovation. It will also lead to a rise in the demand for a range of services, including aged care.

This is not only a condition of fairness between countries, but also a pre-condition for deeper integration. Only if there is trust that each member will play by the rules can a union of mutual solidarity become possible. For these reasons, moving towards closer economic union also requires an equivalent deepening of political union.

Before the ECB publishes any forecasts, it is crucial that we explain carefully the uncertainties surrounding it, the assumptions being made and to what extent then forecasts actually play a role in our decision. Otherwise, publishing forecasts might finally increase uncertainty and even complicate the maintenance of price stability.

The economy created 253,000 jobs in April and the unemployment rate was 3.4 percent, the lowest since 1969. Job creation has been remarkably resilient to tighter financial conditions. Employers have added an average of 280,000 jobs a month this year. That's down from the 350,000 a month created in the second half of 2022 but still robust.

With the sense of immediate crisis much reduced, regulators can devote more focus to the job of designing and implementing changes to regulatory frameworks – work that is better done outside a period of crisis anyway. Realistically, the task is to reconfigure regulatory frameworks to lower the probability, and the cost, of future crises while assisting recovery from the recent one.

As a result, government deficit ratios declined significantly from their peak levels. In 2012, the euro area government deficit-to-GDP ratio was about 3 percentage points lower than the deficit recorded in 2009. Fiscal adjustment has been particularly strong in countries under market pressure.

I believe that such a favorable employment situation undoubtedly has supported household sentiment. Individuals can feel great confidence when they do not need to be concerned about whether their wages will be cut, even if corporate performance underperforms to some extent, or whether they can find another job.

This sense of reassurance is crucial in Japan, where the mobility in the labor market is said to be relatively lower than in other countries.

Economic growth began to slow from around the end of 2007, due mainly to a sharp decline in housing investment as the revised Building Standard Law came into force.

For capital, the average amount of daily transactions in foreign exchange markets worldwide was 1.5 trillion dollars as of 1998 – which is as far back as we can go in making such a comparison – and grew to 4 trillion dollars, corresponding to almost 20 times world GDP per day, in 2010 (Chart 2).

In China, exports to Europe have declined and private real estate investment has slowed. Against the backdrop of such weakening of demand at home and abroad, inventory adjustment has been prolonged, especially in materials industries with excess production capacity. While the annualized real GDP growth rate is still somewhat high, it has been declining for seven consecutive quarters through this past July–September.

Following this it is intended to interview a number of officials of the Regulator and the Bank who were intimately involved over the period under examination. I also intend to discuss the key issues with members of both the Regulatory Authority and the Board of the Bank.

Since the global financial crisis in 2008, declines in the natural rate of interest and inflation expectations have led to a growing debate about whether monetary policy is becoming less effective. While it is now widely recognized that this is a common challenge for major economies, Japan has faced and addressed such a challenge ahead of other countries.

To further deepen activities of the agent network,  The Bank is developing a digital Agent Registry in collaboration with the financial services industry to enhance the identification and oversight of these agents. The new registry will interconnect with Ghana’s digital address system to provide unique identification for agents and facilitate real-time monitoring and tracking of agents.

You can pay in shops and simultaneously do online shopping and book your next trip using WeChat and Alipay. I don’t want to be misunderstood here: models like these are not a bad thing per se, as they are convenient and useful from a customer perspective. Otherwise, they wouldn’t be so successful.

We gave up our easing bias in the spring and at the June meeting the Governing Council concluded that progress towards a sustained adjustment in inflation had been substantial and decided to halve net purchases again and to end them completely in December 2018.

We should not underestimate, for instance, the impact on South Africa’s ability to 5 See, for instance, M Mecagni et al., “Issuing international sovereign bonds: opportunities and challenges for sub-Saharan Africa”, Departmental Paper 14/02, Washington DC: International Monetary Fund, 2014. BIS central bankers’ speeches 5 attract and retain foreign investments from our strong performance in this respect.

Indeed, in the 2015 Global Competitiveness Report published this September by the World Economic Forum, South Africa continued to score first, among 140 countries, on criteria such as “financing through local equity market” and “strength of auditing and reporting standards”. We came second in the regulation of our securities exchanges and third in the protection of minority shareholders’ interests.

These are very challenging topics and deserve thorough discussion. I wish this seminar a great success! Thank you! 2 BIS Review 147/2010

The surge in globalization of finance has also gained momentum with the technological advancements which have effectively overcome the national borders in the financial services business. Widespread use of internet banking has widened frontiers of global banking, and it is now possible to market financial products and services on a global basis.

Risk management techniques need to extend beyond calculations of VARs and the like – as complex as such calculations already are – and to think about whether the possible size of losses associated with the 2 BIS Review 85/2006 one-in-a hundred event really are well described by standard distributions drawn from recent history.

This will be a core theme of my lecture today: namely that certain aspects of social capital – in particular trust and credibility – are essential for an independent central bank to achieve its mandate, and in achieving our mandate we can, in turn, help to build and sustain economic capital.

BIS central bankers’ speeches 1 The MAP toolbox is generally thought to operate mainly through the banking sector; this is certainly the case for most of the instruments that we are beginning to explore following the introduction of the Basel III and CRD-IV-CRR regulation.1 Hence, the regime could be both more powerful and more important here than in market-based economies.

If a variation in MAP capital buffers had a broadly similar impact on the supply of bank credit in the US and in the EA, I would expect its impact on total credit to be stronger in the EA, where non-bank credit is both smaller and relatively less elastic.

Njuguna Ndung’u: Strengthening regulatory frameworks in the finance industry – a key enabler for private sector development Keynote speech by Prof Njuguna Ndung’u, Governor of the Central Bank of Kenya, at the 1st Annual Africa Banking and Finance Conference, Nairobi, 21 February 2011.

The new structural arrangements are designed to enhance how we operate as One Bank, recognising the interlinkages, dependencies and need to challenge each other across financial stability, prudential regulation and financial conduct disciplines.

However, the pace of increase in exports is likely to remain moderate for the time being, mainly due to the following: (1) the waning effects of inventory restocking in overseas economies; (2) the slowdown in the high growth of emerging economies, primarily reflecting tighter economic policies; and (3) the yen’s recent appreciating trend.

The way in which risk is spread within the financial system varies over time in relation to several factors, including market and regulatory developments. Enron and Argentina highlight once again the importance of two aspects that characterise risk propagation today: first, the growing use of complex financial instruments to assume and transfer risks and, second, the abrupt changes in international capital movements.

Education and Skills Training 5. Research and Development 6. ICT and 7. Governance The first three require a significant engineering input and specialization in the hard sciences. A cadre of engineers will be required to investigate and develop projects to enhance the infrastructure in these areas.

Just as a point of comparison, let’s turn For example, in addition to the previously mentioned Acharya et al. paper, in a recent paper Meisenzahl (2023) shows that banks have reduced lending in areas more affected by climate change.

You will most likely have explored this issue in much greater depth early on today. As I mentioned earlier, the SSM is only the first pillar of the European banking union. The second is the European Single Resolution Mechanism which will deal with future bank failures. This mechanism has been operational since 1 January 2016.

Its task is to realign incentives and make the entire banking system more stable. In cases where a bank is no longer viable, its shareholders and creditors will be first in line to bear the resulting losses – the taxpayer will only be asked to contribute as a very last resort. This is an urgently needed step in the right direction.

Importance of collaboration What has become very clear, and we have seen it even in the Caribbean, is that there is now significantly more emphasis being placed on collaboration among regulators, and on reducing regulatory arbitrage – that is, the ability of entities to cherry pick where they do business, so avoiding the stricter type regulatory domiciles, because of differences in regulation.

This is particularly important in single economic zones like the Caribbean, and on a larger scale, the EU.

As Governor, I will ensure that as one team, we at the Bank – the Deputy Governors, the Senior Management team, and all our Staff – spare no effort in furthering the objectives of the Bank, that is improve the economic and financial well-being of all our countrymen, keep inflation well under check at low and predictable levels and participate in promoting strong, balanced, equitable and durable economic growth.

Against the background of high inflation, excessive budget deficits, permanent deficits on the current account of the balance of payments, frequent devaluations of the krone and high nominal interest rates, the Danish authorities in the early 1980s made a successful U-turn to a stability-oriented macroeconomic regime. The fixed-exchange-rate policy was, and still is, an important element in the macroeconomic framework in Denmark.

I will take back the knowledge I gain from these discussions and use it to improve our work. And in the process, I hope to help you better understand what the Federal Reserve is doing and what we are trying to accomplish. In doing so, I am confident our work will be more effective and efficient.

Many more had a neardeath experience, and survivors recapitalized by raising $ billion of new long-term capital, including $ billion of equity, from 1991 to 1995. The managers of these surviving organizations had deeply impressed upon them anew the need to manage risks, to control costs, to build capital and reserves, and generally to focus on the lessons of banking history.

The FOMC judges that an inflation rate of 2 percent, as measured by the annual change in the price index for personal consumption expenditures, is most consistent over the longer run with its statutory mandate.

While maximum employment stands on an equal footing with price stability as an objective of monetary policy, the maximum level of employment in an economy is largely determined by nonmonetary factors that affect the structure and dynamics of the labor market; it is therefore not feasible for any central bank to specify a fixed goal for the longer-run level of employment.

5 See, for example, Thornton, H. (1802), An Enquiry into the Nature and Effects of Paper Credit of Great Britain, Bordo, M.D.

This is a historic moment for Slovakia, which will become the 16th country to join the euro area on 1 January 2009, exactly ten years after the euro was set up.

If the tension between the progress on employment and the lack of progress on inflation persists, it may lead me to reassess the expected path of the federal funds rate in the future, although it is premature to make that call today.

The ideal market for this product are microfinance clients who have proven their creditworthiness to their banks. With about three million active micro-borrowers, the market for housing microfinance looks promising indeed. I am confident therefore that we will see a significant increase in affordable housing finance that caters to the needs of the poor in a sustainable and non-subsidized manner.

As regulatory burdens have risen, many community banks have significantly scaled back their lending or exited the mortgage market altogether. These developments concern me for several reasons. Home mortgage lending has traditionally been a significant business for smaller banks, and the decline in this business threatens a part of the banking industry that plays a crucial role in communities.

Bankers who are present and active in their communities know and understand their customers and the local market better than lenders outside the area. Because of their local knowledge and customer relationships, they are often more willing to help troubled borrowers work their way through difficult times. These two challenges notwithstanding, I remain optimistic about the outlook for housing.

Beyond these considerations, however, there are political and economic considerations that have not been addressed here. 1 See Central bank governance and financial stability: A report by a Study Group chaired by Stefan Ingves, Bank for International Settlements, 2011. 2 Article 2 of theTEU. 3 Article 5(2) of the TEU. 4 Article 5(3) and (4) of the TEU.

5 Garry J. Schinasi, “Defining Financial Stability”, IMF Working Paper WP/04/187, 2004, 3; William A. Allen and Geoffrey Wood, “Defining and achieving financial stability”, Journal of Financial Stability, Vol. 2, 2006, 152. 6 The notion of financial stability is often discussed in terms of the concept of systemic risk.

In its capacity as resolution authority, the Central Bank is responsible for the orderly resolution of failing credit institutions, certain investment firms and credit unions16. The Central Bank manages resolution funds and prepares resolution plans for these entities. These plans can then be activated in the event of a failing or likely to fail determination17.

It is also crucial that Brexit does not lead to a race to the bottom in regulatory and supervisory standards, and that the efforts that have been made to strengthen the financial architecture of the EU following the crisis do not unravel. The framework thus needs to provide sufficient safeguards for maintaining financial stability.

That has reduced not just expected inflation, but also the inflation risk premium – the cost levied by lenders to protect them against uncertain price changes. But the decline in nominal yields has also been driven by a fall in real yields, which is the real return generated by the balance of saving and investment in the economy.

Financial and Economic Review 19(3). 130153. Dani Rodrik. 2020. Will COVID-19 Remake the World? Project Syndicate. April 6, 2020. Page 2 von 2

At the same time, we must ensure that our own supervisory practices, tools, and standards take advantage of technological improvements and financial techniques so that our oversight is not only effective, but also as unobtrusive and appropriate as possible.

These tasks are wide ranging, extending from our own re-engineering of the supervisory process to the way supervisors approach issues such as measuring capital adequacy and how we seek convergence on bank supervisory standards worldwide.

And, given the structural forces also at work, we expect the pick-up in wages growth and inflation to be only gradual. The fourth and final point is that, because the progress is expected to be only gradual, the Reserve Bank Board does not see a strong case for a near-term adjustment in monetary policy.

While some other central banks are raising their policy rates, we need to keep in mind that their economic circumstances are different and that they have had lower policy rates than us over the past decade, in some cases at zero or even below.

It hypothesized a deep recession in the United States, with GDP contracting sharply, unemployment reaching a peak of more than 13 percent, equity prices falling by half, and house prices declining by an additional 20 percent from their 2011 levels. In addition, given the potential for financial stress in Europe, the scenario included a global recession and a global financial market shock.

The latter, applied to the trading, derivatives, and private equity positions of the six firms with the highest volumes of trading, included a dramatic widening of credit default spreads for both European sovereigns and financial institutions, as well as sharp increases in spreads for European sovereign bonds.

The government then often has no option but to step in if it wants to prevent a complete meltdown. But, as we all know, such a rescue can place a huge burden on public finances.

Similarly, a study of sectoral specialisation carried out by the European System of Central Banks in 2004 found the production structure of euro area countries to be relatively similar. Indeed, it appears more homogeneous than in the United States and relatively stable over time. In contrast, a host of studies have highlighted agglomeration or clustering effects.

In such an environment, communication by the monetary authority is of the utmost importance and is directed towards informing the markets of its assessment of the outlook for price stability and preparing the markets for future policy moves, thereby avoiding unnecessary volatility and supporting the smooth conduct of policy. Another idea is that the financial markets lead and the monetary authority follows.

In such a world, the monetary authority will seek to satisfy the expectations of financial markets – in the extreme case: whatever they are – by never surprising them. If the monetary authority does not do what is expected the financial markets will ‘punish’ it – for example by demanding higher risk premia to cover the greater uncertainty.

1 For an overview of these events from Italy’s perspective, see I. Visco, speech at the 23rd ASSIOM FOREX Congress, Modena, 28 January 2017; S. Rossi, ‘The Banking Union in the European integration process’, delivered at the conference on European Banking Union and bank/firm relationships, CUOA Business School, Altavilla Vicentina, 7 April 2016.

3 From a legal perspective, banking union formally rests on numerous and complex legislative acts, which I will refer to using their English acronyms.

Fifth, financial sector as a whole, and banking system in particular, may have to consider paradigm shift in strategies and processes consistent with new thinking, as urged by the Prime Minister and the NDC.

We have already witnessed the Fed’s decision last week to plough proceeds from maturing mortgage bonds into government bonds, effectively implying a continuation of the quantitative easing policy.

Overall, a deep and well-established rental market therefore seems to be a mitigant against the effect of shocks to the broader economy and housing markets. This is clear in crosscountry data. Chart 5 contains a scatterplot of losses in potential output during the crisis against rental rates and Chart 6 shows the relationship between rental rates and changes in unemployment.

In both these cases a clear negative relationship is readily apparent. Overall, the evidence suggests that there is a link between the depth of the rental market and the severity of macroeconomic outcomes during the recent crisis. 4.

Furthermore, consumers are taking their time to rediscover the path of confidence, doubtless on account of a still difficult situation in the labour market, of difficulties and delays in the implementation of basic reforms, and of a feeling of insecurity due to insufficient budget consolidation.

Sure enough, a good monetary strategy guaranteeing the solid anchoring of price stability is a necessary precondition for economic growth. It is not a condition that is sufficient in itself, however. A budget strategy guaranteeing healthy public finances and structural reforms making it possible to raise BIS Review 41/2005 1 the level of potential economic growth are also crucial.

BIS Review 70/2008 3 oil price shock of the 1970s, given some time, the economy can become much more energyefficient even as it continues to grow and living standards improve. Let me turn now to the other economic challenge that I want to highlight today – the productivity performance of our economy.

The industrial sector receives maximum credit reflecting continuing industrialization. Goa, being one of the prime tourist destinations, the hospitality sector led services sector in attracting credit. The high per capita income level of the population reflecting greater borrowing capacity explains a high share of personal loans in the overall credit.

I will confine this to some of the rules related to LCR because we have issued the final guidelines; • Recognition of SDL as level 1 HQLA – RBI allows banks to include Indian State Government Securities, also known as State Development Loans (SDL), in the HQLA buffer.

As a result of the food and energy price increases, there were wide gaps between overall and core measures of inflation for both the PPI and the CPI. The overall CPI increased about ¾ percentage point more than the core CPI and overall PPI increased more than two percentage points faster than core PPI.

Therefore, expansion of public sector banks into new areas would depend on the ability and willingness of the Government to infuse capital. 11. The private sector banks have a share of about 18 per cent of the total banking assets in India.

The existing 13 old private sector banks, which have been in existence much before the Banking Regulation Act was enacted in 1949, together with the 7 new private sector banks, have been growing at 20 per cent.

With respect to ownership of the RBI in banks and other refinancing institutions, the Monetary and Credit Policy of April 2001 had expressed the RBI’s intentions to divest its holdings in State Bank of India, NABARD and National Housing Bank through transfer to Government. The RBI has also sent proposals to the Government to transfer its loan portfolio in respect of IDBI, IDFC, etc.

I understand that you have had lively discussions on International Standards and Codes. As you are aware, a Standing Committee on International Standards and Codes was set up to benchmark Indian practices against international standards. The Standing Committee had set up ten advisory Groups in key areas of the financial sector. The Groups have completed their Reports, which are available on the RBI website.

Before I conclude, let me also give a perspective on the global regulatory reforms and how it might impact the Indian banks. Basel III norms have been announced and set to be implemented as per the indicated timeline, with the liquidity regime already kicking in from January 1, 2015.

So you are well-versed with the new regulatory phrases- leverage, capital conservation buffers, counter-cyclical capital buffers etc. The D-SIBs guidelines have also been announced and the list of banks considered systemically important in the domestic context would be unveiled in August 2015. Besides, being subjected to stricter capital and liquidity buffers, these banks may also be nudged to prepare detailed ‘recovery and resolution plans’.

A further surge in oil prices accompanied the Iranian Revolution in 1979. The higher prices of the 1970s brought to an abrupt end the extraordinary period of growth in U.S. oil consumption and the increased intensity of its use that was so evident in the decades immediately following World War II.

Between 1945 and 1973, consumption of petroleum products rose at a startling 4-1/2 percent average annual rate, well in excess of growth of real gross domestic product. However, between 1973 and 2003, oil consumption grew, on average, only 1/2 percent per year, far short of the rise in real GDP.

However, we at the Bank judge that BIS Review 117/1997 -3- because firms’ profitability as well as capacity utilization had remained at a low level, the shock of a sudden appreciation of the yen applied the brakes to the economic recovery. The important issue now is how much strength there is in the recent economic recovery in Japan.

With its universal membership, its unique mandate of maintaining monetary and financial stability, and as an international “supervisor” on the macroeconomic policies of its member countries, the IMF, equipped with its expertise, is endowed with a natural advantage to act as the manager of its member countries’ reserves. 2.

Further the yuan is likely to appreciate over that period relative to the dollar, ceteris paribus (i.e. with unchanged domestic growth rates) reducing the length of the catch-up period. But China faces considerable challenges, and the economy is unlikely to continue growing at 10 percent for another quarter century.

Over the last two years, we have become so accustomed to engaging via virtual platforms, that we missed out on the enriching networking opportunities that an event of this nature affords us.

The euro area economy is continuing to grow. We have now seen almost six consecutive years of expansion, with growth that is broad-based across countries and sectors. During this recovery, the countries that were most affected by the crisis have regained competitiveness thanks to a combination of accommodative monetary policy, fiscal consolidation and structural reforms.

But challenges remain in the form of low trend growth compared with other advanced economies, and persistently high public and private debt levels in a number of euro area countries. Further efforts are therefore needed to strengthen productivity growth and boost productive investments to lift long-term potential growth.

However, the IMF is a quota based institution and there is a general recognition that the current IMF quota formula, while an improvement on previous formulas, remains flawed in that it does not fully recognise the changing economic weight of emerging market and developing countries.

I have already touched on this issue earlier, but would like to reiterate that any shift in quota shares that may benefit specific emerging and developing countries should not come at the expense of other emerging-market and developing economies, and it is important that South Africa ensures the protection of its quota share.

The Bank decided to introduce Quantitative and Qualitative Monetary Easing (QQE) with a Negative Interest Rate at the Monetary Policy Meeting (MPM) held in January 2016. Let me look back on how the Bank came to introduce it.

About three years ago, at the MPM held in April 2013, the Bank made a commitment to achieving the price stability target of 2 percent at the earliest possible time, and decided to introduce QQE as a necessary measure to underpin this commitment.

In addition, the Reserve Bank recently reduced the need for banks to hold government bonds as collateral in the interbank payment system, freeing up the supply of government bonds in the secondary market. We also introduced a ‘bond lending facility’ that improves the liquidity in the government bond market.

Market participants have indicated a preference to see fewer but larger tranches of government bonds offered by the Treasury to consolidate liquidity in a few key sectors of the yield curve. Moreover, unlike Australia, where the supply of commonwealth government bonds is similarly tight, New Zealand has not developed a liquid government bond futures market to provide a substitute.

Currently, there are five different primary measures of inflation – the Wholesale Price Index (WPI) and four measures of the Consumer Price Index (CPI). In addition, Gross Domestic Product (GDP) deflator and Private Final Consumption Expenditure (PFCE) deflator from the National Accounts Statistics (NAS) provide implicit economy-wide inflation estimate.

But it is not just the payment habits of the public in Germany that are subject to constant change. Driven by the increasing cost pressure which the banking industry is facing at present, we are currently observing a shift in the way in which consumers obtain and dispose of cash.

3 Indeed, the worst performers over the past five years have had inflation outcomes close to the average outcome in the 1970s. 4 Thus, the worst inflation today is not nearly as bad as it once was. To give some specific examples, just ten or twenty years ago, annual inflation rates in Brazil and Mexico exceeded 100 percent.

If supervisory stress testing is to give regulators, banks, and the public a dynamic view of the capital positions of large financial firms, it must itself respond to changes in the economy, the financial system, and risk-management capabilities.

Maria decided to walk for over an hour from her home to her employer’s house to receive the money, and another hour going back to her residence. While this story may tug at our heartstrings, this shouldn’t be the case for our people, especially with digital payments on our hands. This pandemic has indeed magnified the limitations of traditional financial services.

The chairpersons and executive directors of the European Supervisory Authorities should be full-time independent professionals rather than representatives of the national supervisors as was the case with the Level 3 committees.

The Reserve Bank Board recognises that monetary policy has a role to play here. Earlier today, we released the minutes of the Board's meeting two weeks ago. At that meeting, we discussed a scenario in which there was no further improvement in the labour market and the unemployment rate remained around the 5 per cent mark.

But in a country with over 600,000 villages, these numbers, while both impressive and commendable, serve to highlight what remains to be done.

BIS central bankers’ speeches 7

Just a bit more than a year after the global financial crisis intensified dramatically in September 2008, it is appropriate to look back at what the Hungarian policy makers have done in the last twelve months. In this stock taking I will focus on the measures of the Magyar Nemzeti Bank, presenting the various policy instruments in a consistent framework.

The growth of household borrowing has moderated over recent months, reflecting the impact of higher key ECB interest rates since December 2005 and cooling housing markets in several parts of the euro area. However, the growth of loans to non-financial corporations has remained very robust.

BIS Review 8/2010 1 d. Policy to deepen the financial market will encourage the development of financial products that can be used as an alternative by banks for productive channelling and placements to the real sector, especially infrastructure financing. Therefore, the financial market is expected to become more liquid with banks becoming less dependent on BI instruments. 2.

As you understand, it is difficult to measure accurately the level of international Year 2000 readiness, and certainly no one can predict with confidence exactly how the century date change will unfold internationally. There are three reasons for this difficulty. First, there is no single indicator that can be used to judge the overall Year 2000 readiness of any country, including the United States.

Second, the state of readiness is a moving target. Judgements are usually based on anecdotal information obtained either firsthand through interviews or surveys or second-hand through other sources. The best information is subject to change.

And, when I tell you that the Bundesbank is attaching great importance to statistics, I am not merely paying lip service to you.

The Federal Reserve Bank of Minneapolis is one of 12 regional Reserve Banks that, along with the Board of Governors in Washington, D.C., make up the Federal Reserve System. Our bank represents the ninth of the 12 Federal Reserve districts and includes Montana, the Dakotas, Minnesota, northwestern Wisconsin and the Upper Peninsula of Michigan. This basic structure has a long history.

Analysis by Bhutta and others uses data from the Survey of Consumer Finances to assess how the cash assistance (expanded unemployment insurance benefits and stimulus payments) under the CARES Act would help families cope with job loss and find that the CARES Act dramatically improves households’ financial security; see Neil Bhutta, Jacqueline Blair, Lisa J. Dettling, and Kevin B. Moore (2020), “COVID-19, the CARES Act, and Families’ Financial Security,” working paper, July.

You have a great deal to look forward to, as many interesting and gratifying opportunities await you. I hope that as you enter or re-enter the working world, you make sure to stay flexible and open-minded and to learn whenever you can. That's the best way to deal with the unpredictabilities that are inherent in life.

One characteristic of great companies, those who endure and thrive over the years while others fail, is said to be “concern for public 2 issues beyond the boundaries of the firm, ... consider(ing) societal interests along with their business interests”.

The risk model, however, has been changing as parties have begun to use the ACH to make one-time payments over the telephone and Internet, payments that are not necessarily based on long-term, trusted relationships.

These requirements ensure that the customer's relationship with the bank continues to be subject to the fiduciary examination programs of the banking agencies that have effectively protected customers for years.

By comparison, the average wealth of the households in the top decile of the income distribution has increased three times faster per year, on average, than the wealth of middle-income households, more than doubling over the period as a whole. The past decade is even more sobering. Middle-income families still have not fully recovered the wealth they lost in the Great Recession.

Six of the seven settlement agreements we have entered into so far this year have related to these pre-defined priorities. Over the same period we have taken reactive enforcement action in a single case which related to a breach of the MiFID suitability requirements by a spread trading firm.

The Administrative Sanction Procedure cases concluded this year have resulted in monetary penalties totalling € million, 6 reprimands and the disqualification of BIS central bankers’ speeches 9 two persons concerned in the management of a regulated entity for a period of three and a half years each. Over 2011 a number of our enforcement cases involved action against lower impact firms.

This significant amount of short-term debt invariably puts pressure on managing liquidity and fiscal authorities have to fund frequently maturing obligations. The shorter-term debt profile also helps explain lower trading activity. As of June 2009, calculations by the ADB show a turnover ratio of 0.37 which literally means a recorded trade value of only 37 centavos per peso of outstanding government security.

At the other end of the tenor profile, many institutional participants choose to immunize their long-term obligations with long-term assets. Even those who may not have such long-dated obligations often prefer to hold Treasury Bonds to term because of the steady stream of coupons over the long-term.

This underscores the fact that the focus on financial sector and market institution issues should not be at the expense of macroeconomic and exchange rate surveillance. This is particularly true for IMF surveillance.

The Bank also decided to take such measures as the expansion of eligible collateral for the Bank’s provision of credit, thereby contributing to smooth fund-provisioning as well as to securing market functioning. These measures likely will strengthen public confidence in continuing with powerful monetary easing, thereby further ensuring the achievement of the price stability target and leading to stability in financial markets.

Moreover, when placed in its proper perspective, the theme of the seminar to my mind, calls for the enhancement of standards and adoption of sound corporate governance practices by banks and their corporate customers.

Arguably the world was no less “risky”, or more precisely, a no less uncertain place in those days. 10 Bernstein writes (op cit, pp. 334-335): “In the early 1970s, long-term interest rates rose above 5 per cent for the first time since the Civil War and have dared to remain above 5 per cent ever since”. This was written in 1996.

13 Bouis, R and R Duval (2011), “Raising the Potential Growth after the Crisis: A Quantitative Assessment of the Potential Gains from Various Structural Reforms in the OECD Area and Beyond”, OECD Economics Department Working Paper No. 835. BIS central bankers’ speeches 7 Raising growth potential is necessary for its own sake – to bring down structural unemployment and increase welfare.

The policy measures announced by European authorities a week and a half ago elicited a quick, strongly favorable market reaction, holding out hope that further financial disruptions can be averted. However, as reflected in the negative turn of equity markets later in the week, and continued tight funding in some European markets, uncertainties are still clouding financial markets.

For this reason, the Bank continues to believe that further reductions in monetary stimulus will be necessary over time to return inflation to its 2 per cent target and to sustain output levels close to capacity.

Since 2013, CBK is part of this organization, led by the Organization for Economic Cooperation and Development (OECD) which aims to raise awareness among children and young people about economic and financial issues.

Seven of them have commenced operations while the remaining three should become operational in next couple of months. The licensing condition of these banks entails focusing on lending to un-served and under-served sections including small business units, small and marginal farmers, micro and small industries and unorganized sector entities.

The SFBs will be required to extend 75 per cent of their loans to the sectors eligible for classification as priority sector by the Reserve Bank with at least 50 per cent of the loan portfolio constituting advances up to Rs. 25 lakh.

If expected inflation moves with actual inflation, and the real interest rate is not too variable, then the nominal interest rate declines when inflation declines--an effect known as the Fisher effect, after the early twentieth-century economist Irving Fisher.

Additionally, the Council has been supporting, co-sponsoring and providing assistance in planning conferences and roundtables on the Year 2000 challenge and will continue to do so. To date, we have conducted meetings for regulators from Europe, Asia-Pacific, North and South America and the Caribbean, and the Middle East. Tomorrow, the Council will sponsor a meeting for the African region in Pretoria.

No, again, that will depend a lot on the economic numbers; it will depend a lot on inflation. We obviously have to discuss it before the end of the year. That’s obvious given what we’ve said on buying bonds until the end of the year and later if necessary.

So that discussion will take place, but it will take place when the data supports it. Is July a live meeting? I know we were talking about it, but is it a live meeting given that it’s July so there’s actually usually low volatility in the markets, and given that you’re not actually doing any new forecasts? Well, we do work in July.

As in previous months, annual growth in M3 was mainly supported by its most liquid components, with the narrow monetary aggregate M1 expanding at an annual rate of 9.1% in July 2017, down from 9.7% in June. The recovery in the growth of loans to the private sector observed since the beginning of 2014 is proceeding.

The annual growth rate of loans to non-financial corporations increased to 2.4% in July 2017, up from 2.0% in June, while the annual growth rate of loans to households remained stable at 2.6%.

Third, the new body responsible for macro-prudential supervision in the EU should be independent in carrying out its tasks and pursuing its objective of assessing and regulating systemic risk.

The fact that the ESRB will be responsible for the assessment of systemic risks and the formulation of pertinent policy recommendations, and that it will not be involved in the implementation of these recommendations strengthens the argument for its policy independence. Fourth, the effective performance of macro-prudential supervision in the EU will require addressing a number of legal, institutional and governance issues.

ii This identification strategy has been proposed by O. J. Blanchard and D. Quah, “The Dynamic Effects of Aggregate Demand and Supply Disturbances,” The American Economic Review 79, no. 4 (1989): 655–673. Demand shocks are neutral for GDP in the long run, while supply shocks have permanent effects on GDP in the long run.

iii See A. Agopsowicz, D. Brouillette, B. Gueye, J. McDonald-Guimond, J. Mollins and Y. Park, “Potential Output in Canada: 2018 Reassessment,” Bank of Canada Staff Analytical Note No. 2018-10 (April 2018).

However, here is where a challenge lies for financial regulators. Innovation is good, but not all innovations are good, and not all good innovations are done well.

2 Seen from the perspective of monetary policy, which are the key areas for coordination that deserve to be underlined? A first one is exchange rate policy. In theory, flexible rate regimes allow countries the implementation of a fully autonomous monetary policy. In addition, they are widely regarded as an efficient mechanism for the adjustment of the economy to external shocks.

In the aftermath of the crisis, Italy’s banking system faces three main areas of weakness: a high share of non-performing loans, low profitability, and the need to adjust its business model to the new technological and market environment. The three areas are closely interlinked.

I am pleased to have this opportunity today to talk about developments in Japan’s economy and present an overall review of the Bank’s conduct of monetary policy. I. Economic and Financial Developments in Japan I will first explain economic and financial developments in Japan.

The pilot programme should commence in the 2022 dry season, and it has the potential of being the game changer for the rice sector in Nigeria. We will work with the various seed certification authorities and explore the possibility of patenting it for RIFAN as part of their legacies under the Programme.

14.Your Excellencies, distinguished ladies and gentlemen, all of the achievements I have highlighted above would not have been possible without the leadership and vision of President Buhari. These accomplishments also show that with the right leadership and vision, we can meet any and every challenge in this country.

Ladies and gentlemen You will agree with me that Malawi has lagged behind its neighbours in the sub-Saharan Africa with its share of regional exports to the world declining sharply over time in terms of the business environment indicators such as transaction costs and infrastructure. Adjusting the exchange rate regime was one of the measures to enhance Malawi’s international competitiveness.

The bank recognises that further steps still remain to be undertaken, such as removal of structural bottlenecks that are retarding growth and diversification of the economy, e.g. reliable and adequate supply of energy. The Bank believes that the private sector is an engine of growth in any economy.

Finally, the quantity-based measure of euro area equity market integration also indicates a rising degree of integration in the equity markets. Between 1997 and 2005, euro area residents doubled their holdings of equity issued in another euro area country to reach nearly 30%.

This implies that, following the introduction of the euro, euro area investors have significantly reallocated their equity portfolio from domestic holdings to holdings elsewhere within the euro area. As a remaining challenge to the integration of euro area securities markets, I note that the euro area securities clearing and settlement infrastructure is not yet sufficiently integrated, although several initiatives are underway.

Figure 5 shows that average wealth also grew steadily for the “next 45” percent of households before the crisis but didn’t fall nearly as much afterward.

The goal is to move to the point where, given current production practices and knowledge, we are getting the absolute most out of the labour and capital resources at our disposal. The second element of productivity is innovation. This means generating new knowledge, improving technology, and enhancing both the processes and the organization of production.

While, in principle, farsighted agents should respond to risk by working longer and/or by saving more, such virtuous responses are often impeded by institutional obstacles (labour market rigidities, financial market incompleteness) and by bounded rationality or myopia. 9 Indeed, the existing private DC schemes are often perceived by households (especially those of slender means) as too risky and too complex (and perhaps too costly).

DB schemes, by contrast, are meant to protect workers against aggregate longevity risk, but uncertainty about future improvements in life expectancy would affect these systems too. In fact, an unexpected increase in longevity would necessitate either increasing payroll contributions or the public debt. And in either case the burden would be borne entirely by the younger generations.

Despite the improvement observed in recent years, with the increase in capital ratios, these remain below the euro area average.

And most importantly, as SBP economists recently highlighted in our Annual Report, we have to focus on social sector of the country in order to improve living conditions of the population.

Improving the monetary policy transmission The Eurosystem offers liquidity to banks to maintain financial intermediation in the money market and to improve the transmission of monetary policy. For this transmission to work optimally, a stable financial sector is needed. For banks are the most important channel via which our monetary stimulus is passed on to businesses and households.

However, as 1 January 1999 approached, the date when the exchange rates of 11 European countries were irrevocably fixed and the euro was introduced, it became clear that, indeed, something special was happening in Europe. In my speech today, I would like to elaborate on some key aspects of the euro area.

But banks’ business model would be affected. The decrease in callable liabilities could ultimately push towards a ‘narrow’ banking system, 12 that is an operational framework in which banks have little or no maturity mismatch between assets and liabilities. The debate about the benefits of narrow banking goes back centuries, 13 with no easy answer; economists will likely have to examine the issue anew.

When we ask ourselves what we must do to increase demand, income, and employment, or when we point to the necessity of designing new industrial policies, the primary objective can only be to put our economic and social system in a better position to face and foster change.

China and other emerging market economies have led the recovery for much of the period, the US has achieved fairly steady growth, while Europe tended to lag. (More recently Asian growth has softened while Europe has picked up somewhat.) • Significant labour market slack remains in some areas of the global economy, especially in parts of Europe.

This was mainly justified by the global collapse of trade that worsened short term economic outlook to a previously unimaginable extent. Hungary as a small, open economy was hit particularly hard by fall in external demand. On top of this adverse external impact, the BIS Review 118/2009 1 sizeable fiscal consolidation further deteriorated short term GDP outlook.

The electronic transactions through NEFT, ECS and RTGS have increased the speed of fund transfer considerably. A good banker should continuously innovate and update themselves with the latest technological advancements to make banking further easier and convenient to customers. Thus, try to develop a good understanding of the latest technological developments.

A bank can implement latest technology safely only with a strong in-house technical expertise. In this milieu, you must “be information literate”, i.e. third generation literate. It is not enough to be a first generation literate, i.e. you know how to read and write, or to be second generation literate, i.e. to be computer literate, but to achieve information literacy.

Financial deepening, by allowing greater diversification of risk and making finance accessible to larger numbers of countries and firms, can be instrumental to broadening economic development. But there is a risk that finance turns into an end in itself, with consequences that can be more damaging as the system becomes more interconnected and the potential for externalities increases.

Some would say that, to the extent that globalisation involves economic interchange, we can simply rely on the invisible hand of the free market, and that therefore rules will not be necessary.

Quoting Robert Schuman: “Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity". And it goes without saying that solidarity must go hand-in-hand with responsibility, which entails rules and mutual surveillance institutional mechanisms.

Before giving the floor to Jean-Claude Trichet, I consider it both an honour and a duty to underline the important role he has played at several stages during the EMU creation and consolidation process, notably in the pre-Maastricht political negotiations and as President of the ECB. Dear Jean-Claude, the floor is yours. Thank you.

If the threat is one of liquidity shortages, the lender of the last resort function will come into play. If the threat is more of insolvency, governments may have to decide between letting institutions fail and arranging conditional rescues, which will involve possibly significant infusions of capital.

Given the significance of inter-connections between prudentially regulated and unregulated entities, other regulatory agencies who keep some watch on the latter, also become logical parts of a collective and co-ordinated systemic risk monitoring and mitigation framework. This is the direction in which many countries, including India, are moving.

QE will help contain the adverse macroeconomic side effects of this necessary process of deleveraging. Portfolio rebalancing means some people will sell assets and get cash to buy other assets, or they will spend it partly. If they buy other assets, some will be outside of the Eurozone.

Also banks could sell portfolios of credit to make room for new private loans and buy public debt. For QE to work, would you need aggregate demand to increase through more consumption and investment, or not? QE will stimulate aggregate demand through all of its components.

As most of the representatives of these financial institutions are also active in the Foreign Investors Council, they can confirm that we were most cooperative in drafting current regulations to our mutual satisfaction.

This is the standard of work I set out to achieve when I became Governor of the National Bank of Serbia, and it is the standard to which I will adhere in the future. I believe the best results can only be achieved through coordinated efforts, which will be continuously adjusted and enriched by our mutual practical experience.

Extending maturities, on the other hand, would leave them on the hook, and they could be still held liable in the event of a later debt restructuring. In an emergency, it can be very difficult to tell for certain whether a debtor is temporarily illiquid or actually insolvent.

Successful junior markets have been established in the United Kingdom (London Stock Exchange Junior Market) and Canada (Toronto Stock Exchange Junior Market). In 2009, a junior market was launched in Jamaica. From all reports, it has been very successful. The main feature of a junior market is that it allows investors to place capital into listed SMEs.

The prices of crude oil and products are subject to much price arbitrage, which has the effect of encouraging the transportation of supplies from areas of relative surplus to those of relative shortage and of thereby containing local price spikes. This effect was most vividly demonstrated in 2003, when Venezuelan oil production was essentially shut down.

Increased global demand, coupled with output restrictions by some producers, has contributed to the higher trend. The prices may, however, be ultimately capped by increased output by US shale producers, who have now become the main swing supplier in the international oil market. While we still expect a moderate increase over the forecast period, there may be some upside risk to this.

So, the challenge for every country, advanced, emerging and developing, is to tailor its financial stability policies to maximize the benefit cost ratio on a dynamic scale. Now let me come to the third leg of the equation – the link between growth and sovereign debt sustainability.

Like with the other two legs of the new trilemma, even in the case of sovereign debt, there is an inflexion point beyond which fiscal deficits militate against growth. Government borrowing is not bad per se, but excessive borrowing is. There is therefore a need to cap total public debt as a proportion of GDP.

For these banks, we will supervise the activity of the national supervisory authority more intensively. This way, the SSM can ensure high-quality supervision that follows uniform standards, even in individual cases, without subjecting each institution to an equally high intensity of supervision.

Instead, politicians continue to engage in protracted debates over who will bear the burden of the substantial adjustments needed to put fiscal policies back on a sustainable path. In my view, these prolonged debates impede economic growth, in part, due to the uncertainty they impose on consumers and businesses.

(p.157) He then goes on to discuss potential reasons for the more rapid adjustment, the most important of which is that the price pressures on individual commodities that are imported or exported as a result of changes in prices in the two countries exert a direct influence – in the direction of equilibrium – in the prices of individual goods. 5.

Actual Price Movements in the Light of the Preceding Theory. (Chapter 11) This chapter concludes 2 BIS central bankers’ speeches The theory must ... be regarded for the moment as a mere hypothesis, the complete validity of which can be established only by further resort to the facts of experience.