samchain/econo-pairs-v1 huggingface dataset:
The development of robust financial markets and enabling environment for enhanced linkages between our markets are essential platforms to supporting our financial institutions and intermediaries for more effective business connections. The creation of counterparty banking lines between Islamic financial institutions in both countries and the development of efficient Islamic interbank money markets will aid this development. In particular, the potential for robust liquidity management would serve as a catalyst to fully capitalise on the tremendous opportunities in the sukuk market in enhancing cross-border financial linkages. The opportunities offered in this dynamic and vibrant sukuk market in both our financial systems are further widened by the fact that the South East Asian region and that of the North Asia and the Middle East countries continue to have high surplus savings that are in search of opportunities for investment and new asset-classes for greater risk diversification and improved returns for their investments. In addition, the participation in key international infrastructures such as the International Islamic Liquidity Management Corporation (IILM) which will provide Shariah-compliant liquid instruments would also facilitate in providing an environment that is conducive for market players to grow. This would address the challenge of building bridges between the fragmented pools of liquidity in many countries, as well as address the cross-border liquidity requirements. The effective business linkages between the market players would in turn lead to cross-pollination of talents and resources, giving rise to innovative products and services, hence creating depth and breadth to the respective national financial markets.

Bagi Malaysia dan Indonesia, kewangan Islam menyediakan peluang strategik untuk meningkatkan perkongsian bagi memperkembangkan lagi kewangan Islam dan seterusnya merangsang potensi pertumbuhan kita bersama. Berdasarkan hubungan yang kukuh antara Malaysia dan Indonesia, kerjasama dalam kewangan Islam juga mempunyai potensi untuk memacu integrasi ekonomi dan kewangan masing-masing dengan negara-negara membangun yang lain. Kewangan Islam akan menggalakkan jalinan padu untuk mengukuhkan lagi kepentingan bersama bagi mencapai kemajuan, kesejahteraan dan kemakmuran yang diingini. Let us take this opportunity to share the many possibilities that are before us. Sekian, terima kasih. BIS central bankers’ speeches  3
Meanwhile, PIs are the adjectives of this new vocabulary, describing the elements of each financial transaction. Together, LEI-nouns and PI-adjectives are key building blocks of a new common financial language. LEIs and PIs have natural counterparts in the world of product supply chains. For LEIs read GLNs – the Global Location Numbers that uniquely define nodes in the global supply chain. GLNs are ultra-flexible. They can denote something as macro as a Wal-Mart warehouse or as micro as a specific shelf in a Wal-Mart store. They provide the co-ordinates of a high-definition map of the global supply chain. For PIs read GTINs (Global Trade Identification Numbers) and the GDSN (Global Data Synchronisation Network). Together, these identifiers define not only products (such as toothpaste) but their attributes (the dimensions of the box the toothpaste is stored in). They too are ultra-flexible. These identifiers define the DNA string for everything from chocolate wafers to collateral swaps. LEIs and PIs are being cast from a similar mould to GLNs and GTINs. International efforts so far have focussed on global LEIs. These are means of capturing, in a common data string, the old banking maxim of “know your counterparty”. In today’s financially interconnected world, knowing your counterparty may be insufficient. So global LEIs aim to barcode counterparty linkages at any order of dimensionality. In November 2010, the OFR issued a policy statement on LEIs.29 This kicked-off an industry process, led by the Securities Industry and Financial Markets Association (SIFMA), aimed at settling on a single, industry-wide entity identification standard.

1  Paper by Robleh D Ali, Andrew G Haldane and Paul Nahai-Williamson. 2  Oh et al (2011). 3  Oh et al (2011). 4  Ginsburgh and Weber (2011). 5  Counterparty Risk Management Policy Group (2008). BIS central bankers’ speeches  1  Compared with these industries, finance has been a laggard. But the tide is turning. Since the crisis, significant progress has been made by financial firms, regulators and trade associations in developing information systems and the common data standards necessary to underpin them. Conferences like this are evidence of that. At the same time, there is a distance to travel before banking harvests the benefits other industries have already reaped. A common financial language has the potential to transform risk management at both the individual-firm and system-wide level. It has the potential to break-down barriers to market entry, leading to a more decentralised, contestable financial sector. And it thereby has the potential to both boost financial sector productivity and tackle the too-big-to-fail problem at source. There is no technological barrier to this transformation. And private and social interests are closely aligned as improved information systems are a public as well as a private good. That public-private partnership is one reason why such good progress has been made over the past few years. So stand back for a good news story – a story of how finance could transform both itself and its contribution to wider society.
According to this methodology, spillovers from the euro area accounted for around half the variance in US Treasuries for most of 2015. And these spillovers have been regaining momentum since mid-2017. Strong correlation between international asset prices therefore doesn’t necessarily result from a common shock. Indeed, in the light of the strong idiosyncratic forces that have increasingly driven a wedge between the monetary policy cycles of advanced economies in recent years, portfolio rebalancing by private investors due to domestic shocks is likely to have increased over time. A dominant chase for yield by private investors, in turn, also distinguishes the current situation from that in 2005 and 2006, which was the last time global yield curves were unusually flat. Back then, purchases by foreign official institutions – themselves often reflecting large current account 3/7  BIS central bankers' speeches  surpluses in certain parts of the world – coincided to drive down long-term yields in the United States, whereas official investors have been net sellers of US long-term Treasuries over the past couple of years. You can see this clearly on my next slide. To the extent that private capital flows are more volatile, the ECB’s November 2017 Financial Stability Review noted the risk of a sudden repricing in fixed income markets should investors decide to rebalance their portfolios. Low inflation risk and bond term premia This brings me to my second factor.

This also means that the flattening of the US yield curve is unlikely to signal a looming recession, as it may have done in previous business cycles. The question, then, is what has caused the US term premium to fall to such an extent since the start of last year. In answering this question, I will distinguish between two broad factors. The first relates to international portfolio rebalancing considerations and the second to investors’ views of the risks surrounding the medium to long-term inflation outlook. International capital flows and long-term yields I have already examined the first factor in other speeches.3 Today I would like to shed some more light on the direction and extent of cross-border spillovers that might currently contribute to keeping long-term yields compressed. To recall, from mid-2014 onwards we observed a striking turnaround in capital flows in the euro area from net inflows to net outflows, just when the ECB had announced its first credit easing package and when expectations were gradually growing among market participants that we would also soon begin purchasing government bonds. You can see this on my next slide. Since then, capital outflows have remained substantial, peaking at nearly 5% of euro area GDP. What has happened is that bond investors, both inside and outside the euro area, have 2/7  BIS central bankers' speeches  rebalanced their portfolios, moving out of euro area debt securities and into the closest substitutes – bonds issued by the safest sovereigns outside the euro area.
In Europe, including Sweden, many banks had borrowed dollars on the US market, where large volumes could be obtained at competitive rates. The US market for short-term funding had been highly liquid. However, when the crisis erupted, the flow of dollars quickly dried up. As is always the case when liquidity disappears from a market, this was due to uncertainty. Who wants to lend money to a bank when they are not certain they will get it back again? In this case, the basis of this uncertainty was that European banks had purchased large amounts of US mortgage securities, often packaged in various structured products, that were difficult to value and therefore also difficult to sell on the market. Where were these securities, often designated as “toxic assets”? Uncertainty also affected banks that had not bought any US mortgage securities, such as the Swedish banks. Because how could  BIS central bankers’ speeches  1  anybody be sure that these banks had not lent money to other banks whose balance sheets were full of structured products? The problem was exacerbated by the fact that a significant portion of the flow of dollars to Europe had come from US MMFs – money market funds. These are comparable to Swedish money market funds, in which firms and private individuals can purchase shares, and where the fund invests in short-term debt securities.

Tarisa Watanagase: Strengthening the banking and financial sector – what needs to be done? Speech by Dr Tarisa Watanagase, Governor of the Bank of Thailand, at Finance Thailand, a seminar organised by The Banker Magazine and Financial Times Business, Bangkok, 22 February 2010. *  *  *  Ladies and gentlemen, First of all, I would like to thank The Banker Magazine and The Financial Times for the invitation. It is an honour, and indeed an opportunity, to join all of you here at this conference, and to share with you my thoughts at this very challenging juncture, not only for the global economy and financial system, but also at an important stage for development of Thailand’s economic and financial sector. The past three years have been one of the most turbulent periods in global economic development. On the global economy front, despite the signs of green shoots in the global economy, we are constantly reminded of the remaining fragility and vulnerability of such recovery in various hot spots around the world, with emerging new paradigm of risk, namely sovereign risk. For the global financial system, risk and challenges remain abound. The key challenge strikes at the heart of the global financial system – regaining trust. Trust in market mechanism, as well as its regulator, has been severely tested.
Progress in corporate governance, the enhancement of the legal and supervisory frameworks that support the banking sector, and an efficient fight against money laundering, are also crucial. They are conducive to achieving the macroeconomic objectives of the accession countries. •  Fourthly, central bank independence is of the essence. It is an integral part of the acquis communautaire, which is laid down not only in national legislation but above all in the Maastricht Treaty. The effective implementation of the acquis communautaire is a prerequisite for accession to the EU, as stressed in the recent Commission report on  4  BIS Review 60/2002  enlargement. But effective implementation is also needed because it implies the effective transformation of accession countries’ economic framework, which should facilitate their integration into the EU and, later, the euro area. In this context, it should be ensured that there is no discrepancy between the central banks’ formal status in the legislation and the implementation of that legislation. It is of utmost importance that all present and future Member States respect this economic and institutional ground rule of the European framework. •  Fifthly, let us not forget the present and future contribution of Central and Eastern European countries to the economic prosperity of Europe at large. It seems that this contribution might be sometimes underestimated, while the relative influence of the US economy, for instance, might be sometimes overestimated.

Philipp M Hildebrand: Where is productivity growth in Europe? Summary of a speech by Dr Philipp M Hildebrand, Member of the Governing Board of the Swiss National Bank, to the Vereinigung Basler Ökonomen, Basel, 28 October 2004. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  Since 1996 the E.U. is lagging behind the U.S. in terms of productivity growth. This phenomenon has become more pronounced since 2001. The growth of GDP per work hour in the E.U. between the periods 1990-1995 and 1995-2002 is lower by two percentage points per year. This difference amounts to 2,8 percentage points per year if one compares the periods 1990-1995 and 2000-2005. Differences in GDP measurement account for roughly 0,5 up to a maximum of 1 percentage point of the productivity growth differential. The remaining difference is caused by two factors. On the one hand, total factor productivity growth has accelerated in the U.S. This was made possible by a wideranging restructuring of the U.S. economy which provided an optimal backdrop for the new information and communication technologies. On the other hand, capital deepening in Europe was lessened by employment growth. The productivity of this additional labour input has to be increased through strong educational efforts, open markets and additional investment. Labour market reforms remain indispensable in order to enhance the productivity of all workers. Product market reforms will be crucial in order to unleash the full productivity potential of the new technologies.
Initiatives to strengthen the rules and the related institutional framework, such as the establishment of national fiscal councils and the European Fiscal Board are helpful. But they are probably insufficient. 2  It is my contention that we will not resolve problems related to fiscal governance in the euro area solely by adjusting the rules and strengthening the institutional set-up. The Five President’s Report moves in the direction of a single fiscal policy, with a euro area wide budget that is large enough to contain in-built automatic stabilising mechanisms that allow for a transfer of resources from those regions in the euro area that are doing relatively well to other regions that have been hit by adverse shocks. But if the will to abide by the existing rules was weak, there seems to be even less appetite for further integration on these lines. On another view, one could recognise that events have shown that fiscal policy remains a vital shock absorber at the national level and that, therefore, it may be necessary to increase, rather than reduce, flexibility in the conduct of fiscal policy. Given that the objective of a common fiscal policy and a common Treasury remains politically unrealisable, one needs to explore other interim solutions which, without creating risks of moral hazard, introduce an element of solidarity between EMU members that go beyond bail-outs and austerity. In the end there can be no longevity in a monetary union where members are moving at very different economic tempos and sometimes even in different directions.

Preventative mitigation is obviously very important, but having impact tolerance means acknowledging that disruptive events will happen, and that firms need to be able to recover within their set tolerance. I’m talking about planning for scenarios that are severe but plausible – we expect firms to be resilient against a wide range of scenarios, but not against Armageddon. I think it likely that the ordering of these impact tolerances between firms and the PRA will often be the opposite way round from capital. On capital, inserting the public interest means that as a general matter we will require firms to hold more capital than they would if left to their own devices – hence, a battleground. For operational resilience, a firm is likely to experience significant private costs – for instance, impact on their profits or damage to their brand – before their safety and soundness is at risk. The exception to this may be a subset of operations whose failure might pose a systemic risk to financial stability. But in most cases, I think interests are likely to be aligned – we all just need to get better at managing this set of risks, as some recent events have illustrated all too painfully. In this context, I will expand briefly on the PRA’s particular focus in this important area. Our general statutory objective is safety and soundness, with policyholder protection on the insurance side and a secondary objective to facilitate competition.
This would push down real interest rates and thereby increase the probability of the lower bound not creating too many problems. But for this to work requires a lot from the communication of the central bank as well as from economic agents’ ability to take in and comprehend the temporary change in the formulation of the target. Such a change could even be counterproductive in that it would become more difficult rather than easier to understand what monetary policy involves. Raising the inflation target would of course also entail problems. However, my assessment is that it is easier to affect inflation expectations by stating a clear figure to aim at. There are a number of earlier examples that this has been possible in practice. Admittedly, this has usually concerned bringing down inflation expectations, but that is no simple task either. Not least in the case of Sweden, there were strong headwinds and considerable doubts that we would succeed. My most important message Let me conclude by briefly summarising my most important messages. In the short term, within the current framework, the Riksbank has a number of tools to counteract the next economic downturn. But the low neutral interest rate, combined with need to conduct a very expansionary policy in recent years, may create certain problems, depending on how soon the downturn comes and how deep it is.

My reflections on amendments to the framework The fact that the different proposals for amendments in the monetary policy framework all have their advocates among well-reputed economists shows that there are advantages and disadvantages with all of them and that none is clearly better than the others. Personally, I believe, as I said at the beginning, that one needs to think very carefully before changing the current framework at all. One must be very certain that one has come to the end of the road, and we probably aren't there yet, as I see it. For instance, many of the problems I have taken up will be resolved, or at least alleviated, if the global neutral interest rate rises. Although most people believe that it will be low for a long time to come, there are also those who believe an upturn is not that far away. 33  32 Disregarding this long-term argument it is not obvious how a target for nominal GDP growth will contribute to resolving, or even alleviating, the problem of the interest rate’s lower bound. 33 For example, Goodhart and Pradhan (2017) say that global demographic trends in the coming decade will turn around the downward trend in the global neutral interest rate. 15 [24]  Higher inflation target a natural further development But if I were nevertheless forced to take a stand, I would say that I lean towards raising the inflation target as the most natural means of further developing the monetary policy framework.
Consistent with its remit, the MPC has judged that it has been appropriate to set policy so that inflation returned to its target over a longer period than the conventional horizon of 18-24 months in order to support jobs and activity at a time when uncertainty was elevated and the economy was slowing. It therefore implemented a package of easing measures in August 2016 – shifting the trade-off upwards and to the right  13  One third of the 4% shortfall in real wages reflects stronger-than-projected inflation, which is almost entirely accounted for by the referendum-related fall in sterling. The remainder reflects weaker-than-expected nominal wages, the majority of which can be accounted for by weaker-than-anticipated productivity growth. 14 Specifically, in exceptional circumstances, “shocks to the economy may be particularly large or the effects of shocks may persist over an extended period or both”. When this is the case, the challenge facing the MPC can be more significant, and the remits directs that “[i]n forming and communicating its judgements, the Committee should promote understanding of the trade-offs inherent in setting monetary policy”, including, importantly “the horizon over which the Committee judges it is appropriate to return inflation to the target”. 11  All speeches are available online at www.bankofengland.co.uk/speeches  11  (from the mauve dot labelled ‘August 2016, no stimulus’ to the purple dot labelled 'August 2016' in Chart 6).

The MPC now views the economy’s potential growth rate to be around 1.5%, about 60% of its pre-crisis average. That diminished rate of supply growth reflects the climate of the past few years, with the shallowest investment recovery in over half a century,  12  lower growth in labour supply and modest productivity growth. By the first quarter of this year, UK GDP had increased by 1 percentage point less than the MPC had projected in May 2016. Factoring in the stronger-than-anticipated growth in the European and global economies and more supportive fiscal policy, the shortfall increases to around 1¾%-2%. 11  This was in line with the MPC’s standard approach to condition its projections on the government policy of the time. By contrast, growth in UK total investment outperformed the rest of the G7 in 2017. That reflected strong growth in spending on buildings. Dwellings investment (1.7pp) and spending on other buildings and structures (2.1pp) together contributed 3.8pp to total growth of 4.0%. 12  10  All speeches are available online at www.bankofengland.co.uk/speeches  10  Even without taking those additional factors into account, average household incomes are currently 4% lower than the MPC had expected prior to the referendum, equivalent to over £ per household. 13  Lambda: trade-off management in exceptional circumstances The MPC has repeatedly emphasised that monetary policy cannot prevent either the necessary real adjustment as the UK moves to its new trading arrangements or the weaker real income growth likely to accompany that adjustment.