The vertical line marks the shift between forecast and technical projection. Source: The Riksbank  14 [16]  1  See Sveriges Riksbank (2017a). 2  See Archer and Moser-Boehm (2013). The major features of the Swedish operational framework are not unique, but common to monetary policy in most countries. 3  Regulatory frameworks set other liquidity requirements for banks, but the liquidity need not consist of central bank money. 4  Up until 2009, banks’ remunerated liquidity surplus was not part of the monetary base in Sweden, but in 2009 the definition was changed to include the liquidity surplus (see Sveriges Riksbank, 2009). The new definition is more in line with international recommendations and practice, but, in my opinion, is a poor measure of what the literature refers to as the “monetary base”. 5  This is a simplified description of the Riksbank’s operational framework for the implementation of monetary policy. More detailed descriptions can be found in Nessén, Sellin and Åsberg Sommar (2011) and Sveriges Riksbank (2014). 6  Goodfriend (2011) calls this way of conducting monetary policy “interest on reserves policy” which he differentiates from the textbook model’s “monetary policy”. See also Woodford (2000) for an analysis of how monetary policy works in a world without a monetary base. 7  There was a liquidity deficit in Sweden before the financial crisis. At that time, the Riksbank supplied liquidity to the market by lending to banks via repos (hence the “repo” rate).

Today, we are paving the way for closer collaboration between INCEIF and the institutions of higher learning in Malaysia to realise our common objective of developing the pool of expertise in Islamic finance. This collaborative move, would establish a network of mutual co-operation and collaboration that would strengthen the efforts between the institutions of higher learning in the areas of curriculum development, research, training, exchange of ideas and information, and resources in Islamic finance. This partnership in connecting the knowledge communities in Malaysia needs to be developed and maintained on a long-term basis. Entering into strategic alliances with institutions of higher learning, Islamic financial institutions and other organisations would create greater synergy, which may bring about new approaches, new technologies and new areas of specialization. Collaborative efforts between INCEIF and institutions of higher learning in particular, would strengthen the ability to leverage on the respective institutions' expertise in research. The introduction of new research findings in Islamic financial engineering could pave the way for increased innovation of new products. This would contribute towards broadening and deepening Islamic financial markets and thus strengthen the overall development of the Islamic financial industry. In addition, active collaboration between academic researchers and the practitioners will enable the practical application of research findings. BIS Review 125/2006  1  One of the strategic steps that INCEIF has initiated is the forging into strategic alliances with the five takaful operators to collaborate in promoting and undertaking research, development, training and education in Islamic finance.