samchain/econo-pairs-v1 huggingface dataset:
Islamic finance is an established industry in Malaysia. Islamic banking assets stood at RM874 billion or 30.4% of total banking assets as at end September last year, with an annual growth of 10% over the past three decades. The end of Q3 last year also saw takaful contributions amounting to RM1.7 billion with market penetration at 15%. Growth of Islamic finance in Malaysia has been resilient and supportive of social and economic developments. What underlies this growth is the robust foundation and building blocks that the government and Bank Negara Malaysia, together with the industry, have worked towards, namely in infrastructure development, institution building, robust regulatory framework and product development. We are now at a stage where we view that the foundations are solid and the industry is ready to deliver solutions to meet your needs. Islamic finance as an enabler of growth There is now a wide ranging spectrum of Islamic financial products to meet the needs of businesses.

So, I will elaborate briefly on the achievements in Turkey in the last four years. Since the 2001 crisis, a comprehensive stabilization program has been put with determination into practice. Tight monetary and fiscal policies along with an intensive structural reform agenda have been the three main pillars of the program. Thanks to these policies, firstly, disinflation has finally succeeded. Inflation targets have been reached in three consecutive years; the inflation rate of 73.2 percent in January 2002 is now down to single digits that is 8 percent as of September 2005 after three decades of high and chronic inflation. Furthermore, not only inflation fell to single digits, but also dynamics of inflation have changed significantly and that ensures the irreversibility of the disinflation process in Turkey. After so many failures in three decades, the turning point came when the Central Bank of Turkey (CBT) has been granted independence. In May 2001, the CBT Law was amended so that the primary objective of the CBT has been defined as to achieve and maintain price stability, and since November 2001, no credits are extended to the public sector. I should say that these developments have been the milestones of disinflation in Turkey. The change in inflationary dynamics also came as a result of a very transparent communication policy, which has been instrumental in changing the expectations of the public about stabilisation. Policies gained credibility; inflation inertia has decreased sharply; the volatility of inflation too has declined.
Foreign direct investment in the banking and the financial sector should also be encouraged as it allows the transfer of technology and management skills. But it should be clear that such an opening up of the capital account should, in times of financial stress, not lead to fire-sale prices. Measures aiming at protecting the financial system liquidity from the adverse consequences of sudden changes in market sentiment (the so-called “liquidity-at-risk policy”) should be given further consideration. The Argentine authorities have adopted such a policy by introducing a liquidity requirement on banks’ short-term liabilities (foreign as well as domestic liabilities). This system has been supplemented by a Contingent Liquidity Facility with a number of international banks. More generally, policies designed to discourage excessive short-term foreign borrowing and based. on market mechanisms should be supported. For instance, unremunerated reserve requirements on short-term foreign liabilities are an incentive to lengthen debt maturity; domestic savings should be more systematically mobilised through a development of domestic financial markets (promotion of larger and deeper financial markets). In particular, making short-term foreign liabilities more costly would also promote borrowing in local currency, making the financial system less vulnerable to external shocks. BIS Review 81/1999  2  International financial markets and international governance issues As to the promotion of efficient functioning of global markets, I would like to insist on three points: í  Firstly the specific dangers associated with the “herd instinct” of market participants.

It is thus no exaggeration to say that those present at a similar dinner six years ago felt quite optimistic about the prospects for the European economy, within Monetary Union, although the Union had only just taken its very first steps and euro banknotes and coins had not even begun to circulate. We now have the benefit of the experience built up in the intervening period. The euro has meant tangible benefits in terms of savings on transaction costs for citizens, eliminating exchange rate risks within the area, facilitating market integration and it has provided an environment of economic and monetary stability. The ECB has attained high credibility in a short period of time which is undoubtedly a result of the clarity of its objectives, the effectiveness of its strategy and the soundness of its decisions. Nevertheless, it is a fact that the European economy has not managed to repeat growth figures close to those seen in 2000. It has been prone to bouts of notable sluggishness, highlighting - in addition to the effect of an unusual series of adverse shocks - the structural shortcomings holding back activity and employment. We have therefore seen that, despite the favourable effects a monetary policy unequivocally geared to price stability has on economic prosperity, the full effectiveness of its contribution requires an ambitious reform agenda in other economic policy spheres.
Since the beginning of the 1990s, the increase in productivity throughout the  4  Friberg, K. and E. Uddén Sonnegård, "Changed wage formation in a changing world? ", Sveriges Riksbank Economic Review 1, 2001. 5  Calmfors, L. & Driffill, J., (1988), "Bargaining structure, Corporatism and Macroeconomic Performance", Economic Policy 6. BIS Review 63/2002  3  economy has been approximately 2.0 per cent, while the average increase during the 1980s was only around 1.2 per cent. The strong growth in productivity at the beginning of the 1990s was partly due to the fact that primarily companies with low productivity were driven to closure during the crisis, at the same time as there were extensive cutbacks in staff. There has also been a structural transformation in Swedish trade and industry towards a more knowledge-intensive production. During the second half of the 1990s there were deregulation processes in several fields, for instance the electricity and telecommunications markets, which led to an increase in productivity. In addition, Sweden benefited from the strong growth in the IT and telecommunications sector, which has shown greater increases in productivity than other areas of the economy. Increased use of IT in traditional manufacturing industry and service operations probably also contributed to the increase in productivity. In addition and at a more general level, greater macroeconomic stability has probably reduced uncertainty and facilitated long-term investment decisions, which in the longer term is positive for the development of productivity.

Fiscal data, overall, are in line with this target, albeit work should still be done with regard to the rigorous implementation of public borrowing and spending plan. The monetary policy implemented by the Bank of Albania is at very simulating parameters. Interest rates and financing costs are at historical low levels. The Bank of  BIS central bankers’ speeches  1  Albania has ensured that the market is fully supplied with liquidity and has provided longterm guidance on the monetary policy direction. In accordance with the monetary policy direction, the Bank of Albania has continued to implement easing supervisory and regulatory measures. Also, we will announce a major project very soon, aimed at addressing definitely the issues related with the treatment and reduction of non-performing loans. All these measures have contributed to and are expected to better support the Albanian economy with funds. As I said above, the economic and financial equilibriums of Albania are solid. The current account deficit improved in the first quarter and the Albanian foreign exchange position is quite positive. Banking system’s liquidity and capitalization indicators have been improving. The growth of non-performing loans decelerated and the Albanian banking system is profitable. Taking into account the international setting, I would like to guarantee the public that the banking system has no direct exposure to the Greek crisis. Our analyses, both at individual bank and system level, confirm that that it would maintain the soundness and normal operations even in extreme adverse scenarios.
6  The counter-cyclical capital buffer may consist of Core Tier 1 capital or other capital than can completely absorb losses. The Basel Committee will specify what types of capital the banks can include at a later date. 7  Issuing bond is a less costly alternative for acquiring capital than issuing shares for tax reasons. Interest rate payments for bonds are made pre-tax while share dividends are paid from post-tax profits. 6  BIS central bankers’ speeches  The sum of the new capital regulations There are many new regulations and levels and it may be difficult to estimate what the banks’ total capital requirement will ultimately amount to. It we limit ourselves to looking at Core Tier 1 capital we can see that the new regulations mean that all banks will need to hold share capital and retained earnings amounting to at least 4.5 per cent of their risk-weighted assets. In addition there is the capital conservation buffer of 2.5 per cent and the counter-cyclical capital buffer of a maximum of 2.5 per cent. This means that in a situation where the countercyclical capital buffer is fully activated the banks will need Core Tier 1 capital amounting to at least 9.5 per cent, and this applies to all banks. There are also discussions about whether additional capital requirements should be placed on those banks that are considered to be systemically important. At present, no decision has been made on which banks this would be, nor on the levels that could apply.

Under the new regulations, a bank will only be able to include debt instruments that can be converted into share capital if the responsible supervisory authority believes that the bank has problems that threaten its survival. 8 Leverage ratio One of the more discussed elements of Basel III is the introduction of a leverage ratio. The aim of this measure is to restrict the banks’ total indebtedness and to set a limit for how large a part of the balance sheet the banks may fund with debts. To comply with the new regulation, the banks must retain capital corresponding to at least three per cent of the value of their total exposures, or assets if you like. In contrast to the minimum capital requirement, the leverage ratio is not a risk-weighted measure. This means that the banks should not take into account to whom or for what they are lending when they calculate their total assets. In addition, most of the items off the balance sheet should be included at their full nominal value. One reason why this new type of measure has been developed is that a number of banks – not least the US investment banks and UBS in Switzerland – experienced major problems when the financial crisis began because of their high level of indebtedness. 8  For a debt instrument to be included as Tier 2 or Tier 1 capital the contract must clearly state that it can be converted into share capital if the responsible supervisory authority finds this necessary.
The prices of individual goods and services go up and down all the time. And large individual price changes - whether or not you take them out of your preferred measure of inflation, as some central banks do – always add to the difficulties of interpretation. The MPC needs to focus on persistent price movements. It has to look through short-run volatility and judge how fast the average price level is likely to rise over the next few years. This is the time horizon which is relevant for policy, since changes in interest rates take a year or two to have their effect. The current rate of inflation says rather little about where inflation is likely to go. We need to judge, as best we can, the changing balance of supply and demand in the economy – inflationary pressure. But why has unemployment been rising? One possibility is that the labour market is still feeling the effects of the period of below-trend growth in late 2004 and 2005. We know that employers tended to hold on to people then rather than letting them go, probably because they expected – rightly as it turned out – that the slowdown would be shallow and short-lived. As demand picked up, they were able to work their existing staff harder again, rather than hiring new people straight away. But meanwhile the potential workforce – the number of people in work or who say they would like to work - has been growing at its fastest rate in twenty years.

Rachel Lomax: Perspectives on current monetary policy Speech by Ms Rachel Lomax, Deputy Governor of the Bank of England, to the Cardiff Business Club, Cardiff, 27 November 2006. I am very grateful to Gareth Ramsay for his help in preparing this speech, and to a number of colleagues at the Bank of England for useful comments. *  *  *  The decade to 2004 was one of the most remarkable in the UK’s economic history. For the first time in a generation, inflation was low and stable. Output grew for forty straight quarters, and the unemployment rate fell steadily to levels not seen since the mid seventies. By these high standards, the economy’s performance over the past couple of years looks slightly more mixed. After a mild slowdown in the first part of 2005, output has been growing steadily at around its long-term average rate for the past year. The inflation rate has varied around the target. But unemployment has been rising for most of the past eighteen months. As always, there is more than one view about what may be going on. I want to start by setting current monetary policy preoccupations in a broader context, and highlighting some difficult issues. Was the UK alone in experiencing such unusual economic stability since the mid 1990s? What might have caused it? Was it expected? Can we count on it continuing? And how should monetary policy makers deal with the exaggerated expectations that the stability of the past decade may have encouraged?
An improvement in trend productivity, for example, implies lower resource utilisation and thereby lower underlying inflation, and vice versa. Such supply shocks should therefore influence the construction of monetary policy. BIS Review 35/1998  ˝  -5-  Advantages and drawbacks of the CPI A drawback with the CPI is that it combines information about both the underlying trend and temporary price movements. So why has the Riksbank chosen the CPI as its target variable instead of some indicator of underlying inflation? The reason lies in the CPI’s advantages as a familiar index that is used in many contexts, whereas the opposite applies to the concept of underlying inflation. Sweden could, in fact, supplement the CPI figures with a series on underlying inflation statistics that would ultimately become more familiar. This is a matter that the CPI Enquiry will be considering. But it is still not clear just how an index of underlying inflation should be constructed. What is clear, however, is that this function cannot be performed by the Net Price Index because that excludes only one type of transitory effect, namely indirect taxes. In that it includes other transitory effects - for example mortgage interest costs and international oil price movements - the Net Price Index gives a picture of inflation’s underlying trend that is incomplete and distorted. Another alternative would be to use the EU’s harmonised index of consumer prices (HICP), which is constructed to exclude house mortgage interest costs.

The price stability objective will have statutory force and the function of the Riksbank will be to ensure that this objective is fulfilled. The amendments to the legislation on the Riksbank have already been approved once by the Riksdag (Sweden’s Parliament) and a second vote on this constitutional change is scheduled for after the general election in September. The reform is supported by five of the political parties and thus by a clear parliamentary majority. BIS Review 35/1998 ˝  -2-  These changes meet EU requirements concerning monetary policy and the role of the central bank. Whether or not we adopt the single currency, Sweden has undertaken to have an independent central bank and this entails a far-reaching delegation of monetary policy decisions on the basis of an operational objective. Budget policy aimed at surplus Similarly, Swedish fiscal policy will continue to be based both on our national objectives and on the requirements that have been adopted for the European Union. An objective for Sweden’s public finances has been set up by the Government and approved by the Riksdag. In the medium term the government budget is to show a surplus, measured as the cyclical average, of 2 per cent of GDP. In that a surplus is generated, government debt can be reduced so that future challenges which Sweden’s economy may face can be tackled without creating problems for government finances.
As attendees at previous regional press briefings may recall, the New York Fed produces economic activity indexes (CEIs) to help monitor the performance of the regional economy. Based on these measures, activity continued to expand in both New York State and New York City through June, with growth decelerating only modestly in the second quarter. By contrast, the recovery in New Jersey’s economy has been more sluggish, though the index for New Jersey did pick up in 2011, which is an encouraging development. We monitor Puerto Rico using an index produced by the Government Development Bank for Puerto Rico. This index shows that the recession there, which started back in 2005 – well before the mainland’s – continues to be a challenge. The sharp decline in activity that persisted well into 2010 appears to have subsided. However, for some time now the island’s economy has experienced a series of fits and starts. As such, the recent improvements will need to be sustained for a period of time before we’ll know that they are breaking out of the pattern of mixed signals. The performance of regional housing markets continues to influence the pace of recovery for local economies. Many of the places hit hardest by the housing bust have had a particularly weak recovery. Although housing markets remain fragile, an encouraging development here is that home prices appear to be firming across much of our region.

William C Dudley: Job creation in the region Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Quarterly Regional Economic Press Briefing, New York, 12 August 2011. *  *  *  Good morning and welcome once again to the New York Fed’s Quarterly Regional Economic Press Briefing. I am pleased to have this opportunity to talk with the journalists covering our region – and through you, to the people in our District. This morning I will focus on regional economic conditions, with particular attention to job creation trends in the Second Federal Reserve District, which covers New York State; northern New Jersey; Fairfield County, Connecticut; Puerto Rico; and the U.S. Virgin Islands. Following my remarks, my colleagues will provide more details. As always, what I have to say reflects my own views and not necessarily those of the Federal Open Market Committee (FOMC) or the Federal Reserve System. National economic conditions The statement issued by the FOMC earlier this week presents a sober assessment of the state of the U.S. economy. Economic growth so far in 2011 has been quite a bit slower than we expected earlier in the year. While jobs growth picked up early in the year, in the last few months conditions in the labor market have deteriorated again and the unemployment rate edged up. Household spending has flattened out, and the housing sector is depressed.
As a rule, however, this has happened when price and wage increases had already taken off and the economy was therefore well on the way to becoming overheated. This can be likened to a driver who has to slam on the brakes because the car is travelling too fast and heading for the ditch. In such a situation, braking heavily is the only remaining chance of avoiding a serious accident. The best way of avoiding such a situation is continuously to adjust one’s speed - be it in a car or in economic activity - to the prevailing conditions. The speed limits on our roads are regulated, of course, by laws enacted by the Riksdag and are also conditioned by the state of the road in question, the weather and other considerations. In the same way, the rate of economic growth is subject to economic laws and the prevailing conditions. Driving schools teach us to keep an eye on the road well ahead so that we can adjust the car’s speed in good time. In that way, abrupt shifts can hopefully be avoided and, by continuously altering the car’s speed and direction, the journey will be safe and stable. The same applies in monetary policy. By looking into the future, it is possible to adjust the repo rate so that a continued increase in production and employment is secured even if signs of a future increase in inflation are discerned. The view is not always clear and the forecasts may be slightly off the mark.

Specifically, I should like to reflect with you on the causes behind the launch of this project and what it has meant to date. I wish to frame it in terms of the safeguarding of the euro,  2/10  but I also aim to cover those elements which, in my view, are lacking when it comes to attaining a truly European and cross-border integrated banking sector. I shall also refer to an even broader objective: namely, achieving a real “Financial Union”. The Banking Union would be part of this, but it would encompass other elements, such as the so-called “Capital Markets Union”. European construction I think it is fair to point out that, since its creation, the EU project has improved the life of millions of European citizens. It has done so not only in economic terms, but also as regards rights and standards of living throughout the Union. Naturally, the success of this common project cannot be judged solely in terms of its economic results; we must also consider its other initial goals. These include increasing the level of political integration and promoting peace, European values and the well-being of European peoples. We should not forget that the European Union was conceived with the aim of ending armed conflict between neighbouring countries, following the horror of two World Wars. The creation in the 1950s of the European Coal and Steel Community was the first step towards an economic and political union of the European countries, with the ultimate goal of ensuring lasting peace.