samchain/econo-pairs-v1 huggingface dataset:
A substantial portion of the revenues from the sale of oil and gas is invested in foreign equities and bonds through the Government Petroleum Fund. As a result, short-term fluctuations in the oil price have less impact on the domestic use of petroleum revenues. In the last 20 years, fluctuations in the terms of trade  3  See for example Tom Bernhardsen and Øistein Røisland. ”Factors that influence the krone exchange rate”, Economic Bulletin no. 3/2000, November 2000. BIS Review 74/2001  5  have been three to four times greater for the Norwegian economy including the petroleum sector than for the mainland economy. The Petroleum Fund thus relieves pressure on the krone exchange rate. Changes in the krone exchange rate may also be due to interest rate changes. Higher interest rates normally make it more attractive to buy NOK-denominated assets and reduce NOK-denominated debt, leading to an appreciation of the krone. In contrast, a decrease in interest rates will normally result in lower demand for the krone and a weaker exchange rate. Experience shows that the interest rate only has this predictable effect on the krone exchange rate when it contributes to stabilising inflation. The exchange rate constitutes an important channel through which monetary policy operates. Changes in the exchange rate are both desirable and intended when they contribute to stabilising inflation. However, fluctuations in the exchange rate can also be a source of economic disturbances.

Caleb M Fundanga: Importance of entrepreneurship in Zambia’s economy Opening remarks by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the PrizeGiving Ceremony for Intermarket Banking Corporation VentureComp 2010 Business Plan Competition, Lusaka, 28 July 2010. *           *  *  Mr Ackim Sinkala, Acting Managing Director – Intermarket Banking Corporation Zambia Limited and Intermarket Securities Limited; Mrs Beatrice Nkanza, General Manager Lusaka Stock Exchange; Dr. Maurice Jangulo, Board Chairman Zambezi Airlines; Dr. Patrick Nkanza, Director General TEVETA; Officials from the Ministry of Science, Technology and Vocational Training; Chief Executive Officers of Financial Institutions and Companies Present; Distinguished Invited Guests; Members of the Press; Ladies and Gentlemen. It is my honour and privilege to officiate at this Prize Giving Ceremony of the VentureComp 2010, K100 Million Business Plan Competition. I was honoured at the beginning of this year to have been given the opportunity to launch this Competition. I did not hesitate to accept the invitation to officiate at this event as the subject of entrepreneurship and the deserved recognition of the entrepreneurial efforts of young men and women is very close to my heart. Distinguished Guests, let me from the onset take this opportunity to commend the sponsors of this competition, Intermarket Banking Corporation Zambia Limited, Intermarket Securities Limited, and their partners, Lusaka Stock exchange (LuSE), Zambezi Airlines and TEVETA for coming up with this excellent and important initiative.
In the current crisis, the securitization boom and the easing of monetary policy in the US helped fund the loan growth, while in the case of the Asian financial crisis, it was the large capital inflows in the form of direct borrowing that funded the credit boom. In both cases, however, poor underwriting standard by banks was an important common contributing factor. Looking back, the Asian financial crisis has been an important turning point for policymakers in the region, as the lessons learned from the crisis had led to many important policy reform initiatives, all of which aimed at strengthening the robustness and the risk management discipline of the domestic financial systems, and this brings me to my second point. BIS Review 96/2009  1  In the case of Thailand, after having restored financial stability in the early 2000s, financial reform became a top priority, with emphasis on instilling prudent regulations and strong risk management. We adopted a macro-prudential approach in the early 2000s, in recognition of the systemic linkages between the financial system and the increasingly opened macroeconomic conditions; utilizing our natural institutional advantage as we continue to oversee both monetary policy and financial institutions supervision. Hence, from 2003 to 2006, a series of macro-prudential measures were introduced, aiming at restraining then the rapid growth of credit, especially credit card loans and mortgage loans.

The journey has not been entirely problem-free, and the experiences we have gained on the way have prompted us to make some changes to practical aspects of policy, or perhaps rather as regards how policy is communicated to the public. We have also had to change and improve our analysis of inflation in different respects. I intend today to touch upon the problems we have encountered on our journey and how we have tried to deal with them. Important to have explicit communication So what difficulties have we encountered as regards defining the inflation target in terms of the change in the CPI? To illustrate this I need first to say a few words about the principles that underlie the Riksbank's interest rate decisions. Like other central banks that have adopted inflation targeting, the Riksbank has worked from the premise that monetary policy affects inflation with a certain lag; it is generally assumed that it takes one to two years before a rate adjustment achieves its full impact on inflation. Against this background, and as a step towards clarifying how we try to attain our target, we have formulated a simple rule for monetary policy: if the forecast of inflation one to two years ahead exceeds 2 per cent the repo rate should normally be raised, and if the forecast is below 2 per cent the repo rate should normally be lowered.
Conclusion and the current situation Let me now briefly comment on our most recent interest rate decision. It may appear strange that the Riksbank chooses to raise the repo rate in a situation where inflation is very low. To understand this, it is important to remember that monetary policy must be conducted on the basis of expectations of the future, i.e. forecasts. It is therefore not the present inflation rate we intend to influence, but the expected inflation rate a couple of years ahead. Back in December we envisaged an inflation rate in line with the target towards the end of the forecast period, given a gradual rise in the repo rate during 2006. Information we have received since December indicates that developments will be slightly stronger in Sweden and abroad than we had assumed. As is often the case when making decisions, there are also arguments against raising the interest rate; productivity growth and import prices are continuing to dampen inflation, and inflation is expected to remain low for a large part of the forecast period. One thing that must be remembered when considering our decision to raise the repo rate, is that monetary policy is still expansionary even after this decision, both from a historical perspective and compared with other countries. An interest rate increase of 0.25 percentage points does not mean that monetary policy has been tightened; it is merely the first step towards less expansionary monetary  6  BIS Review 8/2006  policy.

If there is no conflict with the price stability target, the Riksbank should as an authority under the Riksdag (parliament) support the general economic policy objectives of sustainable growth and high employment. At the same time, of course, it is not possible to accept large deviations if the inflation target is to retain credibility. In an attempt to clarify further, monetary policy is guided by a principle that when there is a deviation from the target, the aim is normally to bring inflation back to the target level within two years. This also gives the Riksbank some scope to take into consideration other factors than the path of inflation when setting interest rates, such as growth and employment, while the principle is based on the idea that the deviations will only be temporary. We thus endeavour in normal situations to meet the inflation target within a two-year perspective. We have chosen this because we would otherwise be forced into substantial interest rate adjustments to keep inflation exactly at target level in the short term, which could subject the economy to considerable strain. In certain cases, however, we may need to have greater flexibility than the two-year perspective allows. If the economy were to suffer a very large supply shock – for instance, in the form of soaring energy prices, or during extreme situations such as wars or natural disasters – the adjustment of inflation could need to be even more prolonged. Otherwise, the strain on the real economy could become unacceptable.
The trend for greater regional economic and financial integration will also provide substantial opportunities for Islamic financial institutions to facilitate the integration process in the region and with other parts of the world, and thus have a greater role in financing Asia’s future growth. Priorities for strengthening financial stability and growth Let me turn to the priorities for strengthening financial stability and growth. Whilst there needs to be continued efforts at the national level to develop the institutional foundations for Islamic finance that will foster effective and efficient financial flows, and ensure that financial stability is preserved, the new wave of internationalization for Islamic finance requires increased collaboration across jurisdictions to strengthen the international financial infrastructure of Islamic finance. Going forward into the future, this will be particularly important given that the international environment has become more challenging. This is to ensure that the greater internationalization of Islamic finance takes place in an environment of financial stability. At the national level, the first priority relates to trend for the domestic Islamic financial system to become more integrated allowing for risks to be rapidly transmittal across the financial system. This requires the development of enhanced regulatory, supervisory and legal  2  BIS central bankers’ speeches  frameworks that are also adaptive and effective to the innovative dynamics and unique mix of risks in Islamic finance. Fundamental to this is the implementation of the international regulatory and supervisory standards and best practices for Islamic finance.

Investment projects amounting to more than USD160 billion to be financed by the Gulf states in Asia have been announced since 2005 2 . In 2006 alone, mega-deals 3 involving corporate acquisitions and real estate purchases from the Gulf to Asia, are estimated to total more than USD18 billion, including multi-billion dollar IPO purchases in financial institutions in China, large oil refineries and telecom companies. The value of such investments are expected to increase to between USD20-30 billion in 2007. For economic regions with high savings and surpluses such as Asia and the Middle East, the challenge is to recycle part of these surplus funds to productive investments in the region. The supply of savings in Asia and the Middle East is by far higher than in any other part of the world. Savings rates here in Asia are expected to remain in the region of 30-40% of GDP for some years to come. 1  The Gulf Cooperation Council represents Saudi Arabia, UAE, Bahrain, Qatar, Oman and Kuwait  2  "A route to riches on the new Silk Road", Financial Times, 21 Dec 2006  3  Worth more than USD1 billion  BIS Review 31/2007  1  Similarly, savings in the Middle East economies have been rising in the recent decade and is expected to average about 30-35% of GDP in the coming years. In 2006, the current account surpluses as percentage of GDP for Asia and the Middle East were about 5% and 23% respectively 4 .
in 2010–2012, and those foreign currency purchases were made at a considerably lower exchange rate than the recent sales. Furthermore, on 19 February the Bank concluded a forward currency swap agreement with Landsbankinn in the amount of 6 b.kr., which means that Landsbankinn will not need to accumulate foreign currency to comply with the Bank’s foreign exchange balance requirements. The Monetary Policy Committee is of the opinion that intervention of this type is justifiable in order to mitigate temporary exchange rate volatility that is addressed more effectively with  2  BIS central bankers’ speeches  instruments other than interest rates. In recent weeks, the foreign exchange market has been characterised by an unusual combination of features: weakening terms of trade, foreign exchange accumulation in anticipation of heavy foreign debt service, foreign exchange mismatches in the banks’ balance sheets and, in part, self-fulfilling expectations of a currency depreciation. Because these conditions are in part temporary and increased foreign exchange inflows are expected as the spring advances, limited one-off foreign currency sales by the Central Bank were considered appropriate to prevent excessive currency depreciation and stem the tide of these self-fulfilling expectations of market participants. This is consistent with the strategy outlined in the Bank’s report Monetary Policy After Capital Controls, published in late 2010. Capital controls were imposed early in the winter of 2008 as part of the Government’s IMF programme.

Encik Abdul Rasheed Ghaffour: Value-Based Intermediation (VBI) propelling Islamic finance Address by Mr Encik Abdul Rasheed Ghaffour, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Value-Based Intermediation (VBI) Dialogue, Kuala Lumpur, 24 August 2017. * * * Over the years, finance has lifted the lives of many, enabled businesses to grow and helped to fund the construction of public infrastructure that we now depend on. Yet, as the global economy transforms and society evolves, the question as to whether the financial sector is sufficiently serving the needs of the real economy continues to be debated. The evidence from the global financial crisis underlines the need for the financial sector to restore its balance with the real economy. There is a need to rethink, reassess and re-strategise the role and contribution of the financial industry. Undoubtedly, there is an increasing expectation for the financial sector to deliver greater impact to the economy and society. I am pleased to be here with you today and be part of this important milestone in our Islamic finance journey. The issuance of the Value-Based Intermediation (VBI) Strategy Paper by Bank Negara Malaysia marks the next step to realising the full potential of Islamic finance. On behalf of the Bank, I wish to thank all of you who have devoted time and effort to work with us in this important initiative.
And we should expect the aggregate impact of individual firms’ decisions in a sector that at the end of 2019 held assets in the region of £ trillion – a figure broadly equivalent to UK GDP in the same year – to be an important influence on speed of recovery and adaptation. But what does the insurance sector do for the economy? If I asked the person on the street about the role of insurance, I’d expect them – once they’d raised the common complaint about insurers putting premiums up every year and telling a story about a particular claim – to speak about the protection it provides to households and businesses against the financial costs resulting  2  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  2  from the occurrence of various risks to their physical property, health, loss of earning power or other unexpected losses. (Though maybe not using quite those words!.) This is a very important function. Efficient transfer and pooling of risk reduces aggregate risk and by freeing individuals from risk allows them to avoid reducing consumption in favour of excess saving. And it allows businesses to put capital to work in their areas of expertise and opportunity, without having to worry about – or reserve for – risks that they are not equipped to manage or diversify, and so will not be adequately rewarded for. It has particularly high value in current circumstances. Excess saving, reduced consumption, and heightened risk aversion would be detrimental to economic recovery.

The contrast between the last two charts could not be more striking: in Switzerland, the secured interbank market progressively took over from the collapsing unsecured market to achieve record volumes of activity in the week following the Lehman Brothers collapse. Clearly this market showed its resilience and fulfilled its function, which no doubt helped prevent a credit crunch materialising in Switzerland. Note that later developments (starting in late autumn 2008) were strongly marked by the abundant liquidity situation created by the SNB swap agreements with other central banks and later by the interventions in foreign exchange markets. As a result, demand for short-term liquidity by market participants disappeared. Preliminary evidence strongly suggests that a key factor in the relative performance of the Swiss and US repo markets lies in the quality of the collateral backing repo transactions.6 In the US, as emphasised in a BIS study, repo markets had doubled in size since 2002, with gross amounts outstanding at year-end 2007 of roughly USD 10 trillion.7 These markets ended up financing up to one-half the total assets of the major investment banks. This growth in volume was based on a widely broadened collateral basket, including corporate bonds, bonds issued by agencies, mortgage-backed securities and other lower-rated collateral. In March 2008, following the Bear Stearns rescue, confidence waned and market participants immediately ceased accepting any collateral other than Treasury and agency securities.
Improved competitiveness and the development of the oil industry facilitated the rapid integration of new technology by firms. Productivity growth remained relatively high up to around 2005. But since then it has declined. The decline has been more pronounced than among our trading partners. The phasing-in of a highly profitable oil industry and higher petroleum revenue spending via the central government budget has amplified the structural shifts in the Norwegian economy. Services production has increased. When the financial crisis hit, industries that do not benefit from oil sector demand or public spending stagnated. The differences in growth across industries has thus widened since 2008. 12  BIS central bankers’ speeches  Chart 14  Labour-intensive sectors with relatively low productivity have accounted for a large share of employment growth in recent years. Employment has shown only moderate growth in industries with a high productivity level, such as manufacturing and engineering. Productivity growth has stagnated in most OECD countries. Goods production has declined, while services production has increased, as in Norway. In many countries this shift was based on borrowing rather than increased earnings. After the financial crisis, funding sources dried up and these countries were faced with a debt crisis. Fundamental structural problems with eroded competitiveness came into evidence. These countries must not only reduce their debt levels, but also engage in a painful process of structural adjustment. Only then can these economies find the path to renewed growth. The Norwegian economy has experienced virtually 20 consecutive years of growth.

One of the recommendations adopted was the need to modernise and harmonise financial sector legislation. This included the current Bank of Zambia Act. 2. Secondly under Southern African Development Community (SADC), the SADC Committee for Central Bank Governors (CCBG) was tasked to develop harmonised  BIS Review 128/2010  1  Encouraged by these two events, the Bank of Zambia embarked on a process of reforming and modernising its legislation. In doing so we relied heavily on the provisions of the Model Law but were mindful that these had to relate to our local circumstances. This exercise has resulted in a “home grown” draft Bank of Zambia Act which is the subject of this workshop. We are pleased to report that the draft has incorporated principles of international best practice.
In particular, it is essential from Malta’s point of view that the presence of subsidiaries of cross-border banks that are systemically important to a host country be given due weight in determining participation in the college of supervisors. International experience has also shown that state intervention may be necessary to resolve problems in the financial sector. The state is often the only entity in a democracy that has the political legitimacy, financial strength and credibility to support ailing institutions and, hence, restore confidence in the financial system as a whole. In extreme situations, which require the injection of public funds, the cost to the public purse can be very high. This is an additional reason why maintaining fiscal discipline in the shape of balanced budgets over the economic cycle is important. This would allow a buffer to be built up that could be used in exceptional situations if required, without jeopardising the sustainability of public finances. Finally, safeguarding the health of the financial sector in these challenging times also calls for prudent behaviour on the part of the market players themselves. Though not under any identifiable threat, Maltese banks should build on their existing strengths by reinforcing their capital base through the retention of a greater proportion of earnings; and, as domestic economic conditions are expected to weaken, loan loss provisioning levels may also need to rise. BIS Review 155/2008  5  The current crisis will not be over until confidence and trust are restored, and the credit channel starts to function fluidly again.

Even if we supplied the correct aggregate quantity of reserve balances, individual depository institutions with a deficiency of reserves had to find and trade with depository institutions with reserve surpluses. A purchase of fed funds therefore represented the marginal source of funding for a bank, and the fed funds rate paid by the bank was the marginal cost of bank funding. The Desk’s daily fine-tuning operations represented a marginal adjustment to the aggregate supply of reserves, mostly in response to the exogenous impact of changes in other balance sheet items, such as Federal Reserve notes and the level of the U.S. Treasury’s account balance at the Fed, which altered the level of aggregate reserves in the banking system. In the five years prior to the crisis, this system functioned with an average of $ billion in reserve balances and about $ billion in excess reserves. Although aspects of this approach evolved over time, this general method for implementing monetary policy was employed by the Desk for decades, and the Desk’s ability to reliably achieve the FOMC’s policy directive was judged quite favorably by market participants. In fact, with increased transparency around the FOMC’s fed funds target (which the Committee began to officially announce in the mid-1990s) and with high confidence in the Desk’s ability to hit that target, markets often adjusted to announced changes in the FOMC’s target policy rate without the need for the Desk to conduct operations to effect the change.