samchain/econo-pairs-v1 huggingface dataset:
An active countercyclical policy with high spending in downturns must be followed by a reversal or tightening measures when economic indicators point to a recovery. However, because the value of the fund has steadily risen, we have long been spared the more demanding tightening measures. This may not be the case in the years ahead. Oil revenue spending over the central government budget has reached a high level. As mentioned, we must take into account the possibility that developments in global financial markets may be weaker than in recent years, with a possible downward correction in equity markets. This will reduce the value of the GPFG. In addition, Norway is facing demographic challenges that will put pressure on government finances ahead. The government also has a responsibility for the balance between the public and private sector. Since 2014, public consumption and investment have risen to a recordhigh share of mainland GDP (Chart 14). The krone depreciation over the past years has entailed a sharp increase in the GPFG’s value in krone terms. This has increased the government’s domestic purchasing power. However, a krone depreciation does not increase our national wealth. In the years ahead, we need a larger non-oil tradable sector. If that sector is to expand, it must be given room to grow. If the government lays claim to a growing share of available production resources, the room for growth will diminish. The government must therefore be especially cautious about increasing public spending on the basis of a krone-driven rise in the fund’s value.

Not to mention, the value of that natural resource was much lower than today (Chart 1). Chart 1 Oil was cheaper before OPEC. Oil price. 2018-USD per barrel 140  2011 USD 124  1979 USD 109  120  120  100  100  80  80  1974 USD 59  60  60  40 1970 USD 12  20 0 1950  140  1998 USD 20  2016 USD 46  40 20 0  1960  1970  1980  1990  2000  2010  Source: BP Statistical Review of World Energy 2019  1 Brofoss, E. (1970), The economic situation. Annual Address to Norges Bank’s Supervisory Council, 16 February 1970. 2  A barrel of oil was selling at below USD 2, or 12 in current US dollars. NORGES BANK  Prices then surged, reaching today’s levels when oil producing countries agreed on production cuts in autumn 1973. Perhaps what we in Norway best remember from that time is the weekend car ban in Oslo and even the King riding the tram. ECONOMIC PERSPECTIVES 13 FEBRUARY 2020  The surge in oil prices also came close to cutting the bloodline of what had been Norway’s most important export industry for more than a century – shipping (Chart 2). In 1975, almost a quarter of the Norwegian merchant fleet was laid up. Chart 2 Oil became the new flagship.
Following the financial crisis, the model for prudential regulation in the UK has been further developed by the establishment of the Financial Policy Committee (FPC) and the Prudential Regulation Authority (PRA). The mandates for both the FPC and PRA are set out in primary legislation: the FPC is responsible for protecting and enhancing the overall stability of the UK financial system; and the PRA’s primary objectives are to promote the safety and soundness of regulated firms and to contribute to the securing of an appropriate degree of protection for policyholders. But importantly, the mandates for the FPC and PRA ensure that other factors such as long-term productivity and economic growth are taken into account when setting policy. The FPC must pursue its financial stability objective without causing serious harm to the wider economy in the medium or I would like to thank Matthew Willison, Hugh Burns, Nicolo Fraccaroli and David Swallow for their assistance in preparing these remarks 6  long term. In other words, the FPC must avoid the ‘stability of the graveyard’. 6 And, the FPC also has a secondary objective, subject to its pursuit of its primary objective: that of supporting the economic policy of the government. The PRA also has an important secondary objective to facilitate effective competition, and must have regard to a set of regulatory principles, including the desirability of sustainable economic growth.

Whatever happens in relation to monetary union it is vital, it seems to me, that we hold on to this fundamentally important consensus. Moving on from there to the narrower question of monetary union, the potential economic benefits and risks have now become much clearer, and are rather well illustrated by our own present monetary policy dilemma. On the one hand, any manufacturer will tell you after his experience since last summer - about the great advantage of intra-European exchange rate certainty. On the other hand, with the single currency comes the single monetary policy the single, one-size-fits-all interest rate throughout the euro-area. The risk very simply is that the single interest rate may not in the event suit the domestic monetary policy needs of all the euromember countries - just as the present level of German interest rates of around 3%, reflecting the disappointing weakness of the German economy, would not at this point suit the UK - where, as I have said, we need to moderate the pace of our economic expansion. The potential economic risks, as well as the potential benefits, were recognised when the Maastricht Treaty was signed - and the famous “convergence criteria” were put into the Treaty precisely in order to limit the risks.
General principles that should inform economic policy in the face of climate change The optimal economic policy strategy to guide the transition to a more sustainable economy requires striking a balance between, on one hand, encouraging decisive action before it is too late and, on the other, mitigating the social costs associated with the transition process. And this requires an appropriate sequence of measures to be adopted. “Early” intervention would mitigate Mark Carney’s “tragedy of the horizon”.1 But, there is no way of hiding that this strategy also comes at a cost, since the economy would have to go through the process of becoming more sustainable with current technology. This would make it impossible to exploit all the potential cost savings and effectiveness improvements of future innovations that are currently not available, but would be if the timing of measures was more orderly and less hasty. With regard to this balance between speed of action and the costs associated with the transition process, the European Union as a whole appears to have decided to take the lead on early action.2 In the case of Spain, some sociological studies3 suggest that most of society is aware of the risks of failing to act and seems to be prepared to accept some of the possible costs that may arise from starting to intervene now. That said, this is a collective decision that can only be legitimately taken by our political representatives.

2  Supervision, which I have the honour of chairing, decided last October to commence work on the financial risks associated with climate change, while the Single Supervisory Mechanism has decided to include climate risks in its Risk Map for 2020, the basis for defining supervisory priorities.5 Also of note is the work carried out by the Financial Stability Board (FSB) to promote the publication by businesses of consistent and comparable financial information relating to climate change.6 Apart from international coordination, a high degree of coordination between the various economic policies is also fundamental. Allow me to illustrate this with an analogy, particularly relevant to the Banco de España and the Eurosystem. As we all know, the European Central bank (ECB) has in recent years been implementing an expansionary monetary policy to achieve its inflation target, and thus support economic growth in the euro area. We on the Governing Council of the ECB have always insisted that the effectiveness of our measures would be increased if they were complemented by a more expansionary fiscal policy (where the margin exists) or an ambitious structural reform agenda. The situation of climate policy is similar. The necessary investment for the technological transformation required in our economy will hardly take place if financial conditions are not favourable or the regulatory environment penalises competition or innovation. Later on I will refer to the role that can be played by the financial sector and also by supervisors, regulators and central banks.
That cost is outweighed by the costs of financial instability to the economy, and the impact on the bank’s ability to meet its inflation objective, as was cruelly underlined in the years following the crisis. But it should be the last line of defence. Unlike my predecessors, and in contrast to many other jurisdictions, I and my successors can look to the FPC and quite a number of lines of defence before needing to deploy monetary policy against risks to financial stability. And finally there is the general, normative, argument that there is simply something wrong when real interest rates are below zero including in the medium and long term (Chart 9). There is a natural and deeply ingrained view that money should have a time value, a return that makes it worth saving and investing. I understand that view well. 22  Previous Deputy Governors for Financial Stability (David Clementi, Andrew Large, John Gieve, and Paul Tucker) voted to increase interest rates 26 times – 15 times as part of the majority while 11 times they were in the minority. 23 The countercyclical capital buffer (CCyB) increases banks’ ability to absorb losses in a stress. The FPC sets the UK CCyB at a rate to reflect the prevailing risk environment. It is currently set at 1% consistent with the FPC's published strategy that it expected to set a UK CCyB in the region of 1% in a standard risk environment.

19  A rather different set of concerns about monetary policy strategy, and particularly about a more stodgy strategy, centre on the fact that UK interest rates are currently very low and the stock of assets purchased in the course of quantitative easing remain on the Bank of England’s balance sheet. 17  Haldane (2017) The MPC’s projections are conditioned on the average of a range of possible outcomes for the United Kingdom’s trading relationship with the European Union. They also assume that households and companies base their decisions on the expectation of a smooth adjustment to those new trading arrangements. 19 Following the United Kingdom’s vote to leave the European Union, the exchange rate fell and the outlook for growth weakened. At the time of the August 2016 MPC meeting, that weakening was particularly evident in surveys of business activity, confidence and optimism. In response, the MPC voted for a package of measures designed to provide additional support to growth and to achieve a sustainable return of inflation to the target. As the Governor set out in his opening remarks at the August 2016 Inflation Report press conference: “by acting early and comprehensively, the MPC can reduce uncertainty, bolster confidence, blunt the slowdown, and support the necessary adjustments in the UK economy”. 18  10  All speeches are available online at www.bankofengland.co.uk/speeches  10  I want briefly to look at three of these arguments: I will call them as ‘room for manoeuvre’, ‘financial stability’ and the ‘time value of money’.
Recent years have seen a financial system that   has outgrown in size,    lost track of its core functions,    and became a major source of risk itself. Overall, the financial sector has veered from its genuine role of servicing the real economy. The current process of overhauling financial system regulation are an important factor to help the financial sector become safer and thus eventually to contribute to sustainable economic growth. It is now important not to lose momentum and to strictly follow the schedules for implementation. At the same time, the adequacy of the regulatory system needs to be assessed on a regular basis. This helps avoiding the mistake of the past that regulators fail to spot new sources of risk arising in the financial sector. The guiding principle on all regulatory measures and any re-dimensioning of the financial sector must be: finance has to regain its core role of servicing the real economy without becoming a source of risk itself. In this way we are heading towards a safer financial system for the benefit of all of us. Thank you for your attention. 13  See http://www.marketwatch.com/story/blackrocks-fisher-banks-must-shrink-by-25-2011-09-23. BIS central bankers’ speeches  7

This package has delivered a broad-based easing of euro area financial conditions since June 4/5  BIS central bankers' speeches  2014: money market conditions have improved substantially; long-term government bond yields, corporate and bank bond yields, as well as bank lending rates to firms and households, have declined markedly; and positive credit growth has returned to the euro area.8 The exceptionally favourable financial conditions have helped the economy recover from the shock waves of the financial and sovereign debt crises. They have insulated the recovery from global headwinds that have engulfed the euro area over the last two years, such as the tensions in global financial markets in August 2015 and the slowdown of global demand since the first half of 2015. More recently, the firming recovery has also broadened across countries and sectors. As regards inflation dynamics, our determined policy actions have been material in warding off deflation. They have also contributed to a re-anchoring of long-term inflation expectations. Market-based measures of inflation expectations, however, have not yet returned to their precrisis levels. Underlying inflation dynamics remain subdued, and risks and uncertainties still prevail, especially those related to the geopolitical environment. To sum up, the ongoing economic recovery is still predicated to a large extent on very favourable financing conditions that, in turn, depend on continued monetary policy support. The firming recovery is not yet sufficiently robust to ensure a self-sustained convergence of inflation rates to levels closer to 2%.
And if any of you think that I’m not living up to those principles, please find a way of getting that message to the fifteenth floor, that I personally am not living up to those three principles. Because, that, in-terms of leadership, that is important. I need to be able to set an example, and I am going to do my best to do so and you have ever any shortcomings as I said, I would like to hear. I want to encourage a culture of discussion, of debate, of openness, so please help me to do that. It should never be personal if somebody has a different opinion to you. We need to put our heads together. We will have different views, we need to throw it out in the open, discuss and then eventually, find the best way forward. And you know there is always concern about the balance between politics and economics. In my view for much of our post independent years – I’m not putting this on one party or the other party, or one government or the other – but if you look back from 1948, for most of the time, politics has trumped economics. It is our job to convince our politicians that good economics is good politics. We need to, as a central bank, to get away from this cycle of stop – go policies, of creating artificial booms through misaligned policies. We need to set a good framework, as I said, for the economy.

This was in the 70s. If you think of the iconic figures who have been on the Central Bank staff, they were legendary figures in this country. I don’t want to mention any names because I might miss some out but you just look back through the history of the Central Bank and you see some great names, people who have made massive contributions to this country. So I wanted to be part of that narrative and so I came back and started life as a probationary staff officer of the Central Bank. And I must tell you, when I was working for the Commonwealth Secretariat, almost for twenty years as Dr. Nandalal said, obviously one travels around. There are 54 members of the Commonwealth and I have been to many countries. And invariably there are various occasions when you are introduced. I was always introduced by saying I started my career in the Central Bank of Sri Lanka and that was a great source of pride, to be able to say that I started my working life in this institution, and I continue to be enormously proud that I was part of this staff of this great institution for fifteen years. So in a way, it is coming the full cycle. It’s like coming back home after a long absence. It is a great pleasure, privilege and an honour to be able to come back.
Employment rate and unemployment in Sweden and Europe (a) Employment rate  70  65  65  60  60  55  55  50  Euro area Sweden 05  07  09  11  13  15  (b) Unemployment  70 15  50  17  15  12  12  9  9  6  6  3 0  Nordic countries Germany Sweden 05  07  09  3  United Kingdom Euro area 11  13  15  0  17  Note. Per cent of population and labour force respectively, aged 15-74 years. Source: Eurostat  Figure 8. Unemployment in Sweden among those born in Sweden and those born abroad and unemployment among those born abroad in Sweden and Europe  20  (a) Unemployment in Sweden among Sweden born and those born abroad  (b) Unemployment among those born abroad in Sweden and in Europe  20 20  20  16  16 16  16  12  12 12  12  8  8  8  8  4  4  4  0  0  0  Swedish born Foreign born  05  07  09  11  13  15  17  Nordic countries Germany Sweden 05  07  09  4  United Kingdom Euro area 11  13  15  17  0  Note.

(c) Percentage responding that labour shortages are a limiting factor for their production. For the United States, data is gathered from the QPC, United States Census Bureau, and for the remainder data is gathered from the ESI, European Commission (d) Per cent, for the euro area, Germany and Finland the ECB's policy rate is referred to. Nordic countries include Denmark, Finland and Norway, except for Figure (c), where Nordic countries include Denmark and Finland. Sources: National sources, the OECD and the Riksbank  Two economists at the Riksbank have studied how the changes on the labour market that I described may have affected prices and wages following the financial crisis. 11 They illustrate in an economic model that the developments on the labour market could have been a contributory factor to the low outcomes in prices and wages. In more concrete terms, they show that increased labour force participation, lower compensation levels and weaker negotiating strength among employees may have dampening effects on prices and wages. If labour force participation increases, it will become easier for companies to find new competence. This reduces recruitment costs. Payroll costs also decline as increased competition for jobs dampens wage demands. All in all, lower costs lead to a downward pressure on prices. Another mechanism that my also mean that the rising labour force participation has contributed to lower prices and wages is discussed by two economists at the Bank of International Settlements.
Muhammad bin Ibrahim: Sukuk as a viable fund-raising and investment instrument Opening remarks by Mr Muhammad bin Ibrahim, Deputy Governor of the Central Bank of Malaysia, at the HKMA-BNM Joint Conference on Islamic Finance, Hong Kong, 14 April 2014. *  *  *  Much has been talked about the global financial crisis that had brought about unparalleled financial miseries, economic calamities and social grievances. While the focus has been on financial reforms and economic remedies, the thought on the minds of governments and regulators is how to create a more sustainable global financial landscape. Emphasis on ethics is key to this approach. Greater involvement in ethical-related business has made its strides in contributing towards the overall strength of the global financial system. Ethical investment itself has gained international recognition in recent years. Estimated to be worth more than USD13 trillion, the ethical investment market now represents over a fifth of total assets managed globally. Pension funds, sovereign wealth funds and institutional investors are leading the way. Europe, the United States of America and Canada make up 96% of the share of this market. In Asia, the market is still relatively small – at less than USD100 billion. As ethical investment catches on in Asia, so too has investment in sukuk. Sharing a close affinity, they optimise financial returns while maintaining social good and upholding strong governance. It is my pleasure to be here today at this Joint Conference on Islamic Finance, organised by the Hong Kong Monetary Authority and Bank Negara Malaysia.

Financial innovation is good and healthy for our economies. Changes that have occurred in the last years strongly contribute to market efficiency and overall increase the resilience of our financial system. By allowing wider spreading of risk through credit derivatives, in particular, hedge funds bring an important contribution to market efficiency and liquidity. At the same time, the implications of those changes for financial market dynamics might be more complex and far reaching than before. New instruments have been developed in a very benign environment. Liquidity in many market segments has not been tested in period of stress. How these instruments would behave in periods of stress is a major question for market participants and authorities alike. In such an uncertain environment, securing the full benefits of the structural shifts in the financial system does put a premium on risk management. Everybody would agree, I think, that the first mitigant against the risks associated with hedge funds is robust internal risk management systems, both in hedge funds themselves and at their prime brokers. These are the basis for an efficient market discipline and a condition for financial stability. Strong and rigorous implementation of sound principles for risk management seem essential. You have noticed the reference, in yesterday's G7 communiqué, to the Paulson's task force (Presidents Working Group).