samchain/econo-pairs-v1 huggingface dataset:
Second, as I noted when looking at the macroeconomic scenario, the overall economic slowdown is becoming stronger, particularly in the euro area, which poses downside risks to the macroeconomic scenarios of the Draft Budget and of the Banco de España. I now review the main courses of action defined by the Draft Budget for budgetary policy in 2019. 2  Draft State and Social Security Budget for 2019  Meeting the deficit target of 1.3% of GDP for general government as a whole included in the Draft Budget depends largely on the projected growth of taxes and social security contributions. On official estimates, the additional revenue would be sufficient to finance a significant portion of the proposed increase in the spending of the State (observing the ceiling set by the Council of Ministers), the social security system and regional and local government. Regarding the behaviour of government spending, many, albeit not all, of the measures in the Draft Budget, were included in the budgetary plan published by the government in October 2018, which moreover provided the expected broad outline of the budgets for the rest of general government. The budgetary plan projected an increase in overall government expenditure in 2019 of 3.1% (in National Accounts terms), below nominal GDP growth for that year, thus allowing a corresponding reduction of the budget-deficit-to-output ratio.

In Africa, we have seen successful waqf projects such as the construction of a commercial complex for Islamic studies in Sudan. Waqf, properly structured and with the right governance could create wealth and economic opportunities. Helping to kick start a Market. Another idea to explore is for the AfDB, sovereigns including central bank, and pension funds to set up sukuk funds to give out funding mandate to support and kick-start domestic and regional sukuk investment in Africa. In Malaysia, our Employees Provident Fund and Central Bank of Malaysia have created its mandate to external portfolio managers to include international Shariah compliant equities and sukuk. This strategy has further stimulated growth of Islamic fund management industry. Perhaps these ideas can be adapted to suit the operational environment in Africa. These ideas that I outlined above have been tested and implemented. I believe the same can be considered by new and emerging Islamic finance jurisdictions. Conclusion Let me conclude that the journey in Islamic finance is a rewarding experience. For this journey, we have to bear in mind that It takes serious efforts. We need to be patient and organized. With determination and perseverance, the result will surely follow. We need to work in unison. Respect diversity. Amplify on the collective agreements. Seek solutions for differences. In time we should come to an understanding. We have to ensure, always, that Islamic Finance must remains competitive. It must make sense. The maths must be right. Exciting opportunities exist for new and emerging jurisdictions in Islamic finance.
At the same time the Bank would be obliged to submit a report to the Government, which would be made public, stating the reason for the deviation, its planned response and the length of time that it expected to take to bring inflation back within target. When the target was set, inflation was running relatively high in Iceland. Bearing that in mind, the upper tolerance limit was set for 6% this year, 4½% in 2002 and then 4% from the year 2003 onwards. Upheavals in the foreign exchange market in the spring and a sharp depreciation of the króna caused a substantial rise in inflation, which exceeded the upper tolerance limit in June. The Central Bank submitted a detailed report to the Government on June 20. Other aspects of the joint declaration included a provision that, notwithstanding the abolition of the exchange rate target band, the Central Bank would intervene in the interbank market in foreign exchange by buying and selling currency if it deemed this necessary in order to contribute towards attaining the inflation target, or if it viewed exchange rate swings as a threat to financial stability. At the same time, the Central Bank undertook to produce a quarterly inflation forecast projecting two years into the future.

And such a winding down was necessary, too, since great macroeconomic imbalances had emerged, reflected most clearly in an unacceptable current account deficit and inflationary pressures. It is therefore inevitable that the output gap will narrow in order to bring down inflation, and that national income will drop even further in order to achieve a significant reduction in the current account deficit, which is far beyond a sustainable long-term level. High interest rates can be painful, not least for the households and businesses that have been imprudent in their consumption and investments recently and have relied too heavily on the facilities of credit institutions. It is out of the question for the Central Bank to base its interest rate policy on the actions of the least prudent members of the community. This can only be based on provisions made in laws and the joint declaration by the Government and the Central Bank this March, i.e. to promote price stability. This is the guiding aim of central bank activities in industrial countries around the world, because it creates a climate for economic growth and greater well-being for citizens. In a world of free capital movements and greatly enhanced access to credit compared with earlier times, businesses and households, and credit institutions too, must find their bearings for themselves. Understandably, many people complain about high interest rates, but the lively debates in recent weeks have often revealed excessive faith in the effect that an interest rate cut would have on economic developments.
Evidence of a persistent ‘greenium’ in secondary market pricing is however more mixed. 14  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  14  Chart 10: Currency composition of bonds by UK  Chart 11: New issue premia for non-financial  domiciled issuers (excluding gilts)  European € bonds (Sep 2020)  Source: CBI, Bloomberg Finance L.P. and Bank calculations  Source: Bloomberg Finance L.P. and Bank calculations  Governments’ interest in issuing green bonds is also growing rapidly. The outstanding stock of sovereign green bonds (SGBs) currently stands at $ (Chart 12), and recent months have seen inaugural issues from a range of countries including Sweden (a use-of-proceeds bond), Luxembourg (the first European sovereign sustainability bond) and Germany (an innovative twin green and conventional issue designed to aid liquidity and comparability). Chart 12: sovereign green bonds in issue  Chart 13: Dutch green corporate bonds  Source: CBI and Bank calculations. Source: CBI, Bloomberg Finance L.P., Luxembourg Government, Swedish National Debt Office and Bank calculations. 15  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  15  The direct benefits to government finances are similar to those in the corporate sector, and include the ability to lock in commitments to undertake climate-improving investment, while reducing issuance costs and reaching a larger, more diverse investor base.

Moreover, irrespective of such extreme situations, we have to manage our currency reserves in the best interests of the country and thus make investments that retain their real value over the long term. Implementation  So, we pursue two objectives with our investment policy – ensuring the availability of the balance sheet for monetary policy purposes and preserving the value of our currency reserves. Page 4/10  In order to achieve these two objectives, the SNB’s investment policy is guided by a number of criteria. In addition, it has to meet two important requirements. Let’s start with these requirements. First, we cannot hedge currency risks against the Swiss franc. Such hedging transactions would trigger additional demand for Swiss francs, thereby increasing upward pressure on the currency. This would run counter to our current monetary policy, which is geared at reducing pressure on the Swiss franc. Second, in implementing our investment policy, we aim for minimal market impact. This is the fundamental distinction between investment policy and monetary policy. Monetary policy measures are deliberately targeted to change market prices. They are intended to nudge monetary conditions in Switzerland – interest rates or Swiss franc exchange rates – in the desired direction. By contrast, the SNB’s investment activity should not trigger any price changes. For this reason, when investing, we always take into account the absorption capacity of the markets. When restructuring our investments, whether between different investment instruments or between different currencies, we exercise prudence and caution.
Traditionally, Spain’s trade balance with our European partners has run a deficit. Two years ago, this deficit had already fallen to € billion, but the good news is that at the end of last year it ran a surplus of a similar amount, meaning that, last year alone, there was a favourable turnaround of € billion in terms of Spain’s trade balance with the countries of the Union. At a greater level of detail we can see how the non-energy goods balance improved from a deficit of € billion, i.e. 5% of GDP, in 2008 to a deficit of only € billion, i.e. 0.5% of GDP, at end-2011. And the balance of non-tourist services, which has traditionally run a deficit, moved into a surplus of € billion at end-2011 after posting a deficit of € billion in 2008. A further example of the progress made during these difficult years has been the restructuring of our credit institutions. The Lehman Brothers crisis forced many countries to adopt numerous measures during 2009 to repair their banking systems. As is known, in Spain’s case the direct effect of the international financial crisis – the sudden emergence of toxic assets on bank balance sheets – was minimal, thanks to the soundness of our regulation and supervision and to our banks’ business model. But the indirect effects of the international crisis, such as the decline in GDP and the drying up of bank funding, seriously affected our system.

So as to be able to have a new toolkit adapted to this crisis, more than half a dozen laws1 had to be approved, from first creating the Fund for the Orderly Restructuring of the Banking Sector (FROB) in 2009 to the last Decree Law approved in February, with regulations that have set about righting the shortcomings. These include the creation of an institution/fund allowing for the obligatory and orderly restructuring of non-viable banks and encouraging the merger of viable ones; the regulation of institutional protection schemes; the possibility of converting savings banks into banks; new capital requirements to speed through restructuring; the granting of greater powers to the Banco de España; the merger of the deposit guarantee funds, etc. Promoting all these changes in a full-blown crisis was like carrying out two tasks on a ship that has hit the rocks: while evacuating the passengers, it was necessary to repair the lifeboats. A most difficult task, as I said, but the seven laws have now been passed. And there is one very positive aspect, namely that all these regulations had the backing of the country’s two main parties. This is perhaps why these reforms have maintained a series of common characteristics and, while giving due merit to the main actors, i.e. the different governments and the legislative chambers, mention might be made of the advice that the Banco de España has offered and continues to offer.
Yet there is one key difference between the situation today and that in the Middle Ages. Then, the biggest risk to the banks was from the sovereign. Today, perhaps the biggest risk to the sovereign comes from the banks. Causality has reversed. State support is one side of the “social contract” between banks and the state. 3 State regulation of banks is the other. Table 1 suggests that the terms of this social contract have  1  Reinhart and Rogoff (2009) provide an outstanding history of financial crises over the past 800 years. 2  Homer and Sylla (2005). 3  Tucker (2009). BIS Review 139/2009  1  recently worsened. That should come as no surprise. At least over the past century, there is evidence of a ratchet in the scale and scope of state support of the banking system (Section 2). Whenever banking crises strike, the safety net has bulged. Like over-stretched elastic, it has remained distended. What explains this ratchet? All contracts are incomplete. 4 Contractual relationships, like personal ones, often break down due to commitment problems. Social contracts between the state and the banks are no exception. This generates a time-consistency problem for the authorities when dealing with crisis – a tendency to talk tough but act weak. This explains historical hysteresis in the safety net (Section 3). So what can be done? There are many reform proposals on the table.

The Bank of Albania considers that the attraction of foreign investments as well as the support and stimulation of domestic investments should be at the focus of decision makers. Structural reforms should be accelerated and Albania’s competitive advantages should be enhanced further. In conclusion, I would like to once again thank the IMF Mission for the useful and constructive discussions. 2/2  BIS central bankers' speeches
In fact, during 2007, China’s economy grew by over 11 per cent and it made the largest contribution to global growth. India grew at more than 9 per cent and Russia at almost 8 per cent. These three countries accounted for onehalf of global growth over the past year, while several other developing countries also maintained their own robust expansions. In fact, the rapid growth in these countries counterbalanced the moderate growth in the United States and other advanced economies. The current global expansion is remarkable in several ways. First, emerging markets and developing countries are now accounting for a high share of growth – more than twothirds, compared with about one-half in the 1990s; Second, the successes arising from rapid growth are not being enjoyed by a few countries only – most countries and regions are doing better in comparison to their own past standards; and, third, the volatility of growth has declined substantially. For example, the Sri Lankan economy has grown at well over 6% during each of the past 3 years and in 2008 too, a growth of 7% or close to 7% is projected. Pakistan too has recorded an average growth rate above 7% during the last 4 years. Mr. Chairman, until the last decade, there was a clear relationship between global economic growth and the growth in advanced economies. As a matter of fact, when major economies, particularly, the USA, recorded a slow down, it retarded world output significantly.

The challenge ahead is to help manage the transition to a monetary system that provides flexibility in the exchange rates of all the major economic areas, and this has to be handled with care. Even with good policy choices here and in other countries, bringing these imbalances down to a more sustainable level will take time. During this period of adjustment, despite our fundamental economic strengths, we will be vulnerable to an elevated risk of volatility in financial markets. This prospect makes this a good time to examine the health of the financial system. The strength of the financial system is a major factor in determining how well economies respond to shocks - weak financial systems amplify the damage to growth. The stronger the financial system, the more effective policy - monetary policy in particular - can be in cushioning the effects of those shocks and helping to restore expansion. We are fortunate in the United States today to have a strong financial system. This system has a tremendous capacity to match capital to ideas, reward innovation, and channel savings to the highest return. And it has demonstrated a capacity for very considerable resilience and stability in face of shocks. What are the main sources of these strengths? Our banks are stronger than they have been in the past. Their larger earnings capacity, higher capital cushions, and the greater diversity of their activities help shield them from a broader range and greater magnitude of shocks than in the past.
At any rate, this is the picture given by analyses in Sweden, the United Kingdom and Australia, for example. Despite periods of severe weakening of the krona, price trends have been restrained. However, no one knows whether this will continue in the future in exactly the same way. Against this background, the Riksbank is primarily interested in the exchange rate in the same time perspective as applies to inflation. That is, one to two years ahead. We do not normally react to exchange rate movements in a shorter perspective. We all know that this has not given us a particularly stable krona, but as far as we can see, the krona has not fluctuated noticeably more than other currencies during the last five or six years. Nor has it been easy to make good forecasts regarding the exchange rate. But it is difficult to see any really good alternative to this way of doing things. Experience of trying actively to guide the exchange rate towards some given level has not been particularly promising. In this context it is worth pointing out that the central bank which in many respects works most closely to the way we do – The Bank of England – continually struggles with the opposite problem. That is, an exchange rate which is too strong. This is one indication that it is not primarily the way monetary policy is formulated which is the problem. During the first years of floating exchange rates, the Riksbank used something called the Monetary Conditions Index (MCI).

In Sweden we have had several deregulations, including those in the taxi industry, domestic air travel and dental care, which have not caused any substantial drop in prices. Other deregulations, including those in the electricity and telephone markets, have had larger moderating effects on prices than expected. The difficulties do not only involve evaluating the effects on inflation of each single deregulation or every new step in internationalisation. They also concern the more principal question of to what extent this type of effect on inflation should be accepted. Where should one draw the line between a relative price change, which leads to such inflationary effects that a monetary policy reaction is motivated, and a change which does not require any such reaction? Presumably, today's increased competition is only part of the whole picture of developments, in the same way that tax increases were during the 1970s and 1980s. At that time, not taking into account the fact that tax increases were part of the inflation process was a considerable policy mistake. In the same way one can ask whether the effects of deregulation and other effects of international competition should really be taken into account today. There are fundamental arguments against the idea of discounting considerable aggregates of goods that have been hit by price falls. What central banks should be trying to do is to stabilise general price levels and not to counteract changes in relative prices.
Moreover, in the past CCPs have increased margins and collateral haircuts beyond the levels required by prudential standards or their own risk models. But doing so they may cause liquidity strains and increase volatility in bond prices which, in turn, affects the transmission of monetary policy. To be clear, CCPs should of course make sure they remain resilient to liquidity risks. But they should do so in a predictable manner and based on sound risk models that should not undercut monetary policy decisions. Recent regulatory reforms These challenges were widely recognised when, in June of last year, the European Commission proposed amending the EMIR framework for the supervision and regulation of CCPs. The Commission acknowledges the essential role played by central banks of issue (or CBIs) in monitoring and addressing risks posed by CCPs to their currency, and has proposed an enhanced and binding role for CBIs under the EMIR framework. This would mean that central banks would become non-voting members in the European Securities and Markets Authority (ESMA) structure responsible for CCPs. ESMA aims to improve the functioning of financial markets in Europe by strengthening investor protection and cooperation between national competent authorities. The enhanced role for central banks would tend to avoid harmful mismatches between prudential decisions and monetary policy. And it would grant central banks a flexible and effective role in determining the conditions under which CCPs that are not located in an EU Member State are allowed to provide services in the EU.

Moreover, any such subordination would imply that the objective of the Internal Market is superior to the objective of Economic and Monetary Union. This is not the case; these are equal and complementary objectives of the European Union. Moreover, as the ECJ made clear in the Pringle case, “[…] each institution of the Union is to act within the limits of the powers conferred on it in the Treaties, and in conformity with the procedures, conditions and objectives set out in them.”5 And third, there is a limitation: Article 22 cannot confer general regulatory competences on the ECB – it can only adjust the ECB’s monetary policy toolkit by clarifying that the competence for clearing and payments covers derivatives. The Treaty drafters made the ECB’s objectives and tasks very clear. As the European Court of Justice said, a measure falls under the responsibility of the ECB when it is intended to pursue an objective such as the consistency of monetary policy or the proper transmission of monetary policy. This objective, in turn, contributes to the primary monetary policy objective of maintaining price stability6. The reason why monetary policy needs to cover CCPs’ liquidity is that derivatives clearing has become a cornerstone of the financial system. We must not forget that ECB measures must also comply with the principle of proportionality. This means that any ECB actions in the field of clearing will have to be appropriate for attaining monetary policy objectives and cannot go beyond what is necessary to achieve those objectives.