samchain/econo-pairs-v1 huggingface dataset:
All in all, it is thus not unreasonable to consider that inflation targeting has contributed towards the higher average growth we have experienced over the two decades since targeting was introduced, as compared with the preceding period. 1  The Swedish inflation target was announced in January 1993 and started to be applied in 1995. For a more indepth review of the relationship with academic research and countries that had previously adopted inflation targeting, see Berg, C., “Experience of inflation targeting in 20 countries”, Sveriges Riksbank Economic Review 2005:1, Sveriges Riksbank. BIS central bankers’ speeches  1  It is important that inflation expectations are not too low There is consequently a lot to be gained from having low, stable and predictable inflation. But it is also important that expectations of future inflation are not too low. One reason for this is that inflation allows wages to develop more weakly in certain areas without requiring nominal wages to be cut. This means that unemployment can be avoided when changes occur that reduce the demand for certain types of knowledge, skill and experience. However, inflation expectations also affect the strength of the Riksbank’s primary monetary policy weapon – the repo rate – and thereby the Riksbank’s ability to stabilise the Swedish economy and lead it out of crises. This is a product of the way inflation expectations affect real interest rates.

At the present time, the insurance provided by many monetary authorities may look cheap because inflation is projected to stay low and markets seem to reward those countries which liquefy public debt. However this equilibrium could be unstable and market makers, aware of some inflation “tail risks”, are hedging themselves through gold or currencies like the Swiss franc whose exchange rates have reached historical highs. By contrast, purchases of sovereign debt by the Eurosystem remained very limited and will stay so. Our objective is simple: avoid disruptions in the monetary policy transmission mechanism. Any lasting liquidity backstop has to come from the governments. This is why we are asking for more flexibility in the European Financial Stability Facility (EFSF). Whether amounts are big enough is a matter of opinion but one could envisage to leverage existing commitments to provide greater intervention capacity. At this stage, the euro area is paying a double price. One for its mistakes and one for its virtues. The mistakes were to allow the piling up of debt through unsustainable fiscal policies over a decade, and then to create ex nihilo a doubt as to their ability to pay those debts. But we are also paying a price for our virtue as we refuse to liquefy our debt through massive monetization of our fiscal deficits. Will our virtue be rewarded at the end? I strongly believe so and I will explain why.
At the same time, it will be critical to avoid further setbacks that would make recovery even more difficult. This includes not only the risk of accelerated infections, but also the risk of business failure and the collapse of the sectors most affected by social distancing, with the consequent loss of human and social capital. It will be especially important to avoid financial instability resulting from the deterioration of the credit portfolio, the cost of funding or the loss of liquidity. The Bank is aware of these challenges and risks and will be on the lookout to contribute as much as possible within the framework of its institutional mandates and powers, but much more will be required to articulate a policy response commensurate with the task at hand. It will be everyone’s responsibility to make the recovery faster, more robust, more sustainable, and more equitable than it has been in other economic crises in our history. From this perspective, to resume a path of growth, we have identified six major challenges: The first is to recover the labor market, severely affected by the abrupt halt in activities across all sectors and territories. This challenge is of the utmost importance for the well-being of the population and needs to be addressed urgently, decisively, and realistically. In this process it will be especially important to focus on those sectors most affected by the loss of jobs, such as women, and to learn from the lessons learned about the weakness associated to the high level of labor informality.

: Quarantines begun in Santiago East  1  5  +116 3 %  Pharmacies  3  0  7  Department stores  Mar. 03  May 05  (*) Percentages show variation between 30 July and 26 August. Source: Central Bank of Chile using Internal Revenue Service data. 17  Jul. 07  1 0  Figure 11  Evolution of local assets v. baskets of comparable countries (1) Tipo de cambio (index, 17/April/2020=100)  102  10-yr sovereign bonds' interest rate (dfiference w/respect to 1/June/2020, percent)  102 0.4  0.4  0.3  0.3  0.2  0.2  0.1  0.1  0.0  0.0  -0.1  -0.1  98  98  94  94  90  90  86 17-04 17-Apr. 86 -0.2  Jun. 06 17-08 17-06 17-Jun. 17-Aug. Comparable basket (2) Sep.  Jul. 07  Aug. 08  09  -0.2  Chile  (1) Vertical lines from left to right mark the dates of: the June monetary policy meeting (June 16), approval in Congress of the idea of legislating on a bill that would allow the withdrawal of 10% of the AFP funds (July 8), and first announcements by the Central Bank of Chile (July 20). (2) The basket of comparable economies is made up of a combination of Latin American assets and commodity exporters (Australia, Brazil, Colombia, Mexico, New Zealand and Peru). Source: Bloomberg.
During the same period, the net income account deficit widened by 3.2% to US $ million from US $ million in the third quarter. This was largely on account of an increase in income on equity payments and interest payments. The current account transfers, increased to US $ million from US $ million recorded the previous quarter, explained by the disbursement of budget grants amounting to US $ million. 43. The capital and financial account deficit widened to US $ million from US $ million recorded in the third quarter. This was largely due to the unfavourable performance of the financial account arising from a surge in short-term deposits abroad by the private sector, despite the increase in foreign direct investment. Developments in the financial sector 44. The overall financial condition of the banking sector for the quarter ended December 2010 was satisfactory. On aggregate, the banking sector’s capital position, asset quality and liquidity were satisfactory. However, the earnings performance of the sector declined largely on account of an increase in the non-interest expenses (due to increases in staff emoluments, reorganization costs and additional tax provisions). 45. Overall financial condition and performance of the Non-Bank Financial Institutions sector was rated fair during the quarter under review. The sector was adequately capitalised with “fair” asset quality, while earnings performance was rated “satisfactory”. 46. As part of the overall objective to enhance financial inclusion, the BoZ undertook provincial sensitisation tours on savings and credit covering all the nine provinces of Zambia.

Christian Noyer: Re-examining central bank orthodoxy for un-orthodox times Speech by Mr Christian Noyer, Governor of the Bank of France and Chairman of the Board of Directors of the Bank for International Settlements, at the conference of the Global Interdependence Center/Bank of France, Paris, 26 March 2012. *  *  *  The unconventional policies implemented during the crisis have transformed the face of central banking. But will these changes prove permanent and will “the unconventional become the new normal?” There is not yet definitive answer to this question. We may not, as easily as we would like, be able to revert exactly to the status quo ante. However, I strongly believe we must make sure that the gains from the pre-crisis period, in terms of monetary and price stability, are not compromised in the process. Prior to the crisis, a description of central banks would have centred on four characteristics: They were focused with price stability being their primary or key objective, and no responsibility was sought or given for financial stability; They were of limited size with very small balance sheets and interest rates as their only policy instrument; They were independent, a condition recognised as necessary to anchor inflation expectations, and embodied in very strong institutional frameworks; And they were successful: the “Great moderation”, a period of exceptional low volatility in output and inflation, was widely seen as a product of efficient and wise monetary policies.
The second strategy is to ensure that we achieve the goals of social equity and economic efficiency in operationalisation of waqf projects. While projects developed from waqf proceeds should benefit society at large, it is my humble view that it makes sense from an economic efficiency standpoint to allow market mechanism to allocate these scarce resources. As waqf is intended to generate benefits in perpetuity for all generations to come, operating the fund on commercial terms allows it to be invested and managed in a manner that ensures preservation of capital. Prioritising economic efficiency can help strengthen the position of waqf to carry out its social equity objectives effectively. To illustrate, rental of waqf-developed commercial complexes should be market determined, but lots with preferential rental rates could be designated for deserving community purposes, such as co-working spaces for start-ups and entrepreneurs. In healthcare, waqf hospital charges should be comparable with private medical fees, but different pricing tiers could be provided for the B40 segment and other deserving patients. Similarly, waqf-owned universities should charge full tuition fees to all, but offer scholarships and other forms of need- and merit-based assistance for high-potential students from less privileged backgrounds. This approach is indeed in line with the conditions for waqf creation – ziyadah and nuqsan, idkhal and ikhraj, which grant flexibility and openness to redirect waqf benefits to those in greater need. If executed well, waqf can be both economically efficient and sustainable, while at the same time fulfiling its socio-economic objectives.

Marzunisham Omar: Waqf – an economic perspective Speech by Mr Marzunisham Omar, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Forum on "Waqf: An Economic Perspective", Kuala Lumpur, 9 April 2018. * * * It is an honour to speak on waqf from an economic viewpoint. Waqf, or Islamic endowment, is a virtuous act which not only serves as a philanthropic tool but holds great potential for economic development. Allow me to share some thoughts on the relevance of waqf and three strategies to unlock its full potential to benefit our country. Revival of waqf is timely to unlock its full potential Waqf is part of Islam’s great and long history. It is a well-established concept, conceived during the time of the Prophet, peace be upon him. When Umar ibn al-Khattab acquired a piece of land, he asked the Prophet how best to use it. The Prophet advised him to make the land inalienable and to use it for the benefit of the unprivileged – the poor and those in need. With that, the land was established as waqf. Over the centuries, this tradition continued and waqf has made vast contributions to the development of Islamic civilisation. Notable examples include the waqf of Süleymaniye in Istanbul, which provided for the construction of schools and universities, and the waqfs of Murad II and of Bayezid II in Edirne that built and operated hospitals that provided free treatment.
Just as important as the amount guaranteed under the scheme is how quickly the deposits can be released. This will partly depend on the amount of capital in the guarantee fund. The rapid release of funds also depends on sound procedures for bank data centres and automated systems. 2  On Monday 17 September, HM Treasury issued the following statement: “I can announce today that following discussions with the Governor and the Chairman of the FSA, should it be necessary we, with the Bank of England, would put in place arrangements that would guarantee all the existing deposits in Northern Rock during the current instability in the financial markets”. On Thursday 20 September, HM Treasury specified the accounts that were covered by the guarantee issued on 17 September. The guarantee covers all accounts existing at midnight on Wednesday 19 September and all accounts in Northern Rock re-opened in the future by those who closed them between Thursday 13 September and Wednesday 19 September, inclusive. The guarantee covers future interest payments, movements of funds between existing accounts, and new deposits into existing accounts. HM Treasury also stated that it would cover existing and renewed wholesale deposits and existing and renewed wholesale borrowing which was not collateralised. BIS Review 115/2007  7  Central banks can respond in a number of ways to combat the kind of turbulence that several countries have now experienced. One response is to supply short-term liquidity, as a number of central banks have done, including Norges Bank.

Growth in household credit has been high for a long period, accompanying the sharp rise in house prices. The increase in housing wealth has amplified the demand for loans. The annual rise in house prices in Norway has been positive since 1992. In real terms, prices have almost trebled, making this the second longest period of rising real house prices since 1819. The rise in house prices accelerated through 2006, and the market showed signs of increased risk-taking and even a state of euphoria. 10  BIS Review 115/2007  Periods of sharply rising house prices have occurred previously. House prices have risen in many countries. Up to 2006 the US experienced the longest period of an uninterrupted rise in house prices. This period lasted for nine years, while the rise in house prices in Norway has lasted for 14 years. Furthermore, the total increase in real house prices in the US through the last period of expansion was far lower than in Norway. House prices have generally risen more in Norway than in the US in periods of expansion. BIS Review 115/2007  11  Developments in house prices reflect periods of expansion – often long – that are followed by a contraction. In periods when house prices have fallen in Norway, they have declined at a faster pace than during downturns in the US. It is only to be expected that fluctuations in Norway are much wider than in the US, with its many large local markets.
One relevant area of active research is why inflation expectations seem to have been so stable over the past decade – the period of the so-called Great Stability. One supposition is that well anchored expectations reflect the introduction of credible inflation targeting regimes – people have understood that central banks are focussed on keeping inflation low, and will take action to reduce it if necessary. Another view is that people’s expectations reflect simpler rules-of-thumb based on actual inflation rates: if that’s the case stable expectations could simply be due to the fact that, over the past decade and a half, inflation itself has been low and stable. These alternatives are hard to distinguish empirically, on the track record so far. But it may make a great deal of difference which is true when it comes to forecasting what will happen to inflation expectations, if we have to deal with a future in which inflation is likely to be much more variable. If people put their trust in the regime, or a “credible central bank”, they are unlikely to revise their expectations about future inflation much, especially if the nature of the current situation is well and honestly explained, including how long it will take inflation to return to target. But if they forecast future inflation using simple rules of thumb based on past actual inflation rates, anything that dislodges inflation from target will affect what people use as their best forecast for future inflation.

The pharmaceutical industry has gained in importance, whereas the share of exports of machinery has declined. In passing, let me just mention that the popular cliché which associates Switzerland with watches is actually true. Their share in total goods exports is sizeable (11%). Note, however, that this has nothing to do with cuckoo clocks, which were invented and are produced in Germany. A closer look at the development across industries reveals that this compositional shift is important in understanding Swiss performance during the crisis. In fact, individual export categories were affected very differently by the great international trade collapse in 2009. While shipments of machinery and metals suffered severely, dropping by roughly 30%, exports of chemicals and pharmaceuticals barely declined at all. As this sector accounted for more than one-third of total exports in 2008, it strongly dampened the negative impact of other sectors. Exports of watches also provided important support. The second structural change has occurred within industries. For instance, the machine industry today is not the machine industry of the 1990s. There has been a constant effort to innovate both products and production processes. Swiss businesses have specialised in high-value-added products. Switzerland has among the highest densities of high-tech industry in the world. The volume of research and development spending is driven by large multinational firms in globally integrated economic sectors, such as pharmaceuticals and chemicals. But small and medium-sized manufacturing firms in a broad range of market segments also play a key role in Swiss exports, and are typically also strong innovators.
In the second part of my speech, I will go on to talk about the SNB’s investment policy, which has become very important in the light of our interventions in the market. I will explain our objectives and the criteria we use for investing the foreign currency purchased in the context of these interventions. The investment policy must support our monetary policy and give us the necessary room for manoeuvre. The economic situation and SNB’s monetary policy Current economic situation  I shall begin by reviewing the current economic situation and the SNB’s monetary policy. Global economic developments have been largely positive. Real GDP of our trading partners grew by some 2% over the past year (cf. chart 1). The US has recovered from the financial crisis; full employment has been reached and the economy is expanding. Recovery also continues in the euro area. Unemployment is falling and GDP is growing in almost all member states. Nevertheless, recovery is not yet as advanced as in the US. Solid growth will still be needed in the future to make up for the setbacks suffered over the last decade. Inflation trends also vary among the various economies (cf. chart 2). The global rise in inflation over recent months is largely attributable to oil prices. However, core inflation – which excludes oil and food prices – has not increased across the board. While it has stabilised in the US, it remains low in other regions, particularly in Japan and the euro area.

Furthermore, recovery varies from one industry to another. Overall, the situation today is much better than many observers had expected at the beginning of 2015. The Swiss economy has once again demonstrated its flexibility by, for example, making swift adjustments to working hours and taking measures to improve production processes. In view of the structural changes taking place, this adaptability will remain key, regardless of developments in the international economy and exchange rates. I’m thinking here of traditional retailing, which increasingly has to compete with internet trading. Digitalisation, too, presents new challenges for manufacturing and finance that will continue to call for major efforts on the part of companies and staff in all the industries concerned. Current monetary policy  What challenges does this situation pose for our monetary policy? We have the statutory mandate to ensure price stability. In so doing, we must take due account of economic developments. Since the beginning of the year, the inflation rate in Switzerland has climbed above zero again (cf. chart 4). As is the case with our trading partners, this is largely driven by oil and food prices. Core inflation is somewhat lower, primarily because of underutilised production capacity. Our current forecast puts inflation in mid-2019 at around 1%. Given low inflation and underutilisation of production capacity, maintaining an expansionary monetary policy in Switzerland is the right course of action to take. The Swiss franc is still significantly overvalued.
The answer is in the levels of output and employment, not their growth rates. After nearly 6 years since the start of the crisis, the level of output in the economy is still 2% below its peak in 2008. A conservative extrapolation of the pre-crisis trend would suggest that UK output is some 15–20% below where it would have been expected to be by this time in the absence of the crisis. It seems unlikely that we will recover much of that gap and in any case the calculation is getting less precise and less relevant. Eventually, economic historians may work out what happened to potential output and we should establish a new reference point. As things stand today, it is difficult to know precisely where the new sustainable growth path of the economy lies (especially as data for the past few years are still likely to undergo significant revision by the ONS). But with unemployment still elevated, and diminishing signs of inflationary pressure in both goods and labour markets, we can be reasonably confident that the economy needs to grow strongly for some time to come, to regain a stable and sustainable medium-term trajectory.

We have been stimulating the economy with historically extreme levels of monetary policy for a long time and a variety of headwinds (including the problems in the euro area, a tightening of credit conditions, the drag on activity from fiscal consolidation, and a squeeze in household real incomes resulting from the fall in productivity and higher energy and commodity prices) have all contributed to limit the effect of that stimulus. What seems to have happened in 2013 is that at least some of those headwinds were perceived to have diminished, allowing the policy stimulus to come through and the resulting growth has generated the renewed consumer and business confidence which reinforces demand. We are very conscious that the headwinds have not gone away: much of Europe and some other parts of the world continue to struggle for sustained growth; fiscal consolidation in the UK (and elsewhere) is likely to continue for a while to come; and the financial sector still needs some rebuilding. Indeed, the official production and construction data released earlier this month were rather disappointing, reminding us that strong growth from here on is by no means guaranteed. But to varying degrees perhaps the very worst of the storms may be behind us. Just a tailing off in some of their negative impacts may have been sufficient to allow the economy to start growing again. Interest rates and forward guidance So why aren’t we moving to tighten policy straight away, why did we issue forward guidance around monetary policy?