samchain/econo-pairs-v1 huggingface dataset:
While financial markets have improved significantly, real estate problems, bank closures, and significant non-performing loans on the books of many banks continue to provide financial headwinds to the recovery. And clearly – as the headlines of the past week have highlighted – financial problems abroad still have the potential to result in slower U.S. exports, and may hold potential further problems for global financial institutions. In sum, my view is that with inflation expectations stable, core PCE inflation rates declining, and significant excess capacity in the economy, accommodative monetary policy remains appropriate. Thank you. 6  See for example the remarks by Chairman Ben Bernanke at the National Commission on Fiscal Responsibility and Reform on April 27, available at http://www.federalreserve.gov/newsevents/speech/bernanke20100427a.htm. BIS Review 62/2010  5

We will continue to carefully monitor – as we always have done – the possible side effects of accommodative monetary conditions. It is crucial to remain vigilant and to use the available micro- and macroprudential policy tools as necessary. I will say more on this during the hearing in my capacity as Chair of the European Systemic Risk Board. The low yield environment needs to be understood in the context of the protracted decline in real yields we have witnessed since the 1980s. And this trend is not unique to the euro area. It largely reflects more structural factors such as a slowdown in productivity growth, which can be reversed through an ambitious structural reforms agenda. In other words, we need a coherent economic strategy in the euro area that complements and enhances the effectiveness of monetary policy. This is why there was unanimous consensus in the Governing Council that fiscal policy must make a more decisive contribution. In view of the weakening economic outlook and the continued prominence of downside risks, governments with fiscal space that are facing a slowdown should act in an effective and timely manner. Where fiscal sustainability is ensured, the potential effectiveness of countercyclical fiscal policy is reinforced in the current environment, given that 4/5  BIS central bankers' speeches  fiscal multipliers are higher in a low interest rate environment. At the same time, governments in countries with high public debt should pursue prudent policies and deliver on structural balance targets.
24  As President Draghi recently noted, “In other political unions, cohesion is maintained through a strong common identity, but often also through permanent fiscal transfers between richer and poorer regions that even out incomes ex post. In the euro area, such one-way transfers between countries are not foreseen…”  BIS central bankers’ speeches  9  Chart 1:  Chart 2:  House prices(a) rose significantly during the boom years across euro area periphery countries and in the UK  UK private sector swung sharply into surplus when the crisis hit but now back close to balance…  (a) Nominal house price indices. Source: OECD. Source: Eurostat (ESA 95 definitions). Chart 3:  Chart 4:  … while Irish private sector surplus endures  Aggregate euro area debt has not fallen relative to GDP since 2007  Non-financial private sector General government  30  Other (incl rest of world)  20 10  Net saving  Per cent of GDP  0  -20 -30 2002  2004  2006  2008  2010  2012  Source: Eurostat (ESA 95 definitions). 10  -40  Net borrowing  -10  Source: Buttiglione, L, Lane, P, Reichlin, L and Reinhart, V (2014) “Deleveraging, what deleveraging?”, Geneva Reports on the World Economy, 16, Centre for Economic Policy Research.

Insurers are required to hold a buffer of assets above the value of their policyholder liabilities that can absorb unexpected losses due to credit defaults, longevity shocks or other reasons. Solvency II limits what counts as own funds to instruments that can genuinely absorb losses. 3. The capital calculation in Solvency II captures all the risks to which the insurer is exposed, including those in other parts of the group. 4. The incentives of owners and managers are brought back into alignment with those of policyholders in a number of ways including: a. Requiring owners to put their own money at risk through minimum capital requirements that must be maintained at all times. b. If capital levels fall close to these minimum requirements, a supervisory ladder of intervention shifts control increasingly away from owners and managers at a time when their incentives to act in the interests of policyholders are weakest because of the temptation to gamble for resurrection. c. Capital requirements are risk-based, so that owners must put more of their own money on the line as the insurer takes greater risk. d. Taking more risk should also never lead to an apparent improvement in the capital position of an insurer. e. The UK Senior Managers’ Regime puts specific responsibilities for the key aspects of running an insurer on individual managers.
In addition, this framework needs to be reinforced by a Shariah framework to ensure that all financial transactions are Shariah-compliant. Islamic financial operations would thus need to be based not only on best practices, but also satisfy the tenets of the Shariah. For Islamic banking and finance to be sustainable, compliance with Shariah principles alone is not sufficient. Over the long run, customers and businesses demand for quality in the products and services that Islamic finance offers. This is the challenge for Islamic banking and finance, to be able to provide a comprehensive range of Islamic financial products and services that are not only innovative and competitive but Shariah compliant. Let me now turn to the development of the takaful industry. Takaful as a system of Islamic insurance, is based on co-operation and mutual help for the good of the society at large. Although takaful has been in the market for more than 20 years, it has yet to make significant inroads. It should however, be noted that although the conventional insurance market is deeply entrenched in several of the Muslim countries, the percentage of the Muslim population that are insured is relatively low. The market penetration level is very low, notably less than 5 per cent in many Muslim countries. In Malaysia, the level of market penetration in terms of takaful certificates in force over the total population is only 3.8 per cent compared to a market penetration for conventional insurance of 34.7 per cent.

[De]Globalisation and inflation Speech given by Mark Carney, Governor of the Bank of England  2017 IMF Michel Camdessus Central Banking Lecture 18 September 2017  I am grateful to Clare Macallan and Iain de Weymarn for their assistance in preparing these remarks. I would also like to thank Will Abel, Fernando Eguren Martin, Rebecca Freeman, Alex Haberis, Simon Lloyd, Rana Sajedi, Andrej Sokol, Gregory Thwaites, Thomas Viegas, Matt Waldron and Gabija Zemaityte for the background research and analysis they conducted as well as Wayne Chapman, Chris Peacock and Lyndsey Pereira-Brereton for help with the presentation materials. 1  All speeches are available online at www.bankofengland.co.uk/speeches  I. Introduction During his term as Managing Director, Michel Camdessus oversaw the second great wave of globalisation. The Berlin Wall fell, capital controls were liberalised, the euro was constructed, and China prepared to join the WTO. Product and financial markets became increasingly integrated, with trade growing at an annual rate of 10% and capital flows of 20%. The effective global labour force doubled, and more than a billion people were lifted out of poverty. Central banks are now grappling with one consequence of such enormous achievements – the impact of globalisation on inflation. All central banks must consider the cyclical relationship between global slack and domestic inflation; the degree to which secular forces from globalisation affect local inflation dynamics; and how global factors influence the stance of domestic monetary policy itself.
Considering that banks’ need for FX swaps can be further reduced through a rise in the use of this option and in the limits allotted to banks, we increased these limits from USD 3 billion to USD 3.6 billion and from EUR 900 million to EUR 1.8 billion as of 7 January 2016. Moreover, we raised the maximum ratio of 50 percent that banks are able to pledge as FX-denominated collateral against their borrowings at the CBRT Interbank Money Market to 70 percent effective 13 January 2016. We expect this arrangement to play a stabilizing role against the stress likely to be experienced in credit risk pricing due to global factors and boost the demand for FX-denominated bonds issued abroad by the Treasury. Detailed information about our Turkish lira liquidity policy of 2016 can be found in the “Monetary and Exchange Rate Policy for 2016” we published on 9 December 2015. Besides interest rate and liquidity policies, we continue to promote prudential borrowing by employing other policy instruments that support financial stability. We have enacted a series of measures since end-2014 with regard to FX required reserves and remuneration rates on TL required reserves which aim to support core liabilities and extend the maturity of non-core liabilities. These policies have proved effective in extending the maturity of FX liabilities and suspending the upward trend in the loan to deposit ratio (Chart 7).

We revised the year-end inflation forecasts for 2016 and 2017 upwards by 1 point and 0.5 points, respectively, compared to the October Inflation Report forecasts. As I have just mentioned, driven mostly by oil prices, USD-denominated import prices have registered a considerable decline since October 2015. When analyzed jointly with exchange rate developments, the downward revision in the assumption for oil and import prices is expected to pull down the end-2016 inflation forecast by 0.6 points compared to the October Report forecast. On the other hand, the portion of January 2015 public price adjustments which exceeds the inflation target, is likely to push the end-2016 inflation forecast up by 0.4 points. Another influential factor on forecasts in this period proved to be the rise in net minimum wages. Given the announced support by the government and the effects of this minimum wage rise on demand and costs to the employer, we revised the end-2016 inflation forecast upwards by 1 point. Considering the effect of the minimum-wage-rise, we attribute 0.3 points of this to the food inflation, which we raised from 8 to 9 percent for 2016. Lastly, we estimate that a higher-than-projected actual inflation rate at end-2015 compared to the October Inflation Report forecast coupled with the rise in core inflation indicators will push the end2016 inflation by 0.2 points.
At the CNB we define momentum as the three-month moving average of month-on-month changes in prices. We use seasonally adjusted and annualised data to make the figures comparable to the target – the CNB's 2% inflation target is in annual terms. Three-month moving averages of month-on-month changes in prices sound very complicated. Moreover, they are seasonally adjusted and annualised... Simply put, we can look at momentum as the inflation we would have if prices increased at the same pace as in the last three months. Using the example of core inflation: In annual terms, core inflation has been coming down since October 2022. It peaked at 14.7% year on year in September 2022. It fell to 11.5% in March and 10% in April. The momentum of core inflation peaked at 17% in June last year. It is now 7%. So, when the new Bank Board decided on rates for the first time in August 2022, the momentum was already falling. Besides core inflation, the momentum has been declining for demand-pull inflation, which only includes consumer basket items correlated with demand (CNB, 2022). It is an analogy to the supercore inflation measure used by our colleagues at the Fed and the ECB. The momentum of demand-pull inflation peaked at 8% in June last year. It is currently below 2%. So, all the relevant inflation momenta are now falling (Adam and Michl, 2023). However, I repeat that although headline, core and demand-pull inflation are falling and so are the momenta, inflation is still at unacceptable levels.

We at the CNB studied with interest the documents for the government coalition's press conference on 11 May called the "Recovery package" (Czech Ministry of Finance, 2023a, 2023b). We welcome the government's austerity efforts. The implementation of the package is in the hands of the government and parliament, not in ours, so I will not comment on the individual steps. Generally speaking, it is essential in the fight against inflation that the state budget deficit falls as much as possible compared with the actual outcome of the previous year, not just compared with the plan. It would be ideal for the fight against inflation if expenditure declined year on year compared with the actual outcome of the previous year (to dampen demand) and indirect taxes were not increased (to avoid increasing inflation). However, that is a political decision and it is not within my competence. In any case, we need our tightest monetary policy in twenty years to be accompanied by a credible budget consolidation plan, which the public will trust to support our efforts to reduce inflation. Inflation is our responsibility. However, we are in this together with the government. We need support from fiscal policy. Reducing inflation is in the country's interest. We have already tamed several money flows in the economy. Above all, reducing the country's debt is now needed for a long-lasting return of inflation to low levels. References Adam, T. and Michl, A. (2022). Inflace v R: cyklický i acyklický píbh? [Inflation in the Czech Republic: A cyclical or acyclical story?]
One view is that it is neither possible nor desirable to counter financial imbalances with an active monetary policy. According to this view, it is impossible to determine precisely the level of debt, asset prices and investments that constitutes an unacceptable risk for the financial system. Both an increase and the level of these variables may be important, but also the situation in the rest of economy. In addition, it is very difficult to determine the timing for a monetary policy response since monetary policy often functions with a lag. Third, the change in the interest rate that is necessary to reduce financial imbalances may be so large that it results in a sharp downturn. It is also conceivable that such an active policy may lead to moral hazard. Investors may undervalue risk if they expect the central bank to intervene when financial imbalances build up. The result may be that economic agents take more risk than is desirable. 9  See Rogoff, K. (2003), “Globalization and global disinflation”, in Monetary policy and uncertainty: Adapting to a change in economy, Federal Reserve Bank of Kansas City. 10 In the UK, developments have been similar. See King, Mervyn (2005), “Monetary Policy: Practice Ahead of Theory, Mais Lecture 2005“, lecture at the Cass Business School, City University, London, 17 May. BIS Review 43/2005  7  Central banks will, nevertheless, place emphasis on the effects of developments in asset prices, the money supply and credit on future inflation and output. The grounds are somewhat different.

One aspect of independence is that the government is not allowed to borrow directly from the central bank. In this way, it is possible to avoid a situation where the government uses the printing press to finance deficits. Printing press financing will lead to inflation over time. In Norway, the government’s possibility of borrowing directly from Norges Bank was eliminated by means of changes in the Norges Bank Act in 2003. (The change became effective 1.1.2005.) Now, the Norwegian government has large surpluses and saves considerable amounts through the Government Petroleum Fund. The change may therefore appear to be of little practical importance, but it is not completely uninteresting. The Petroleum Fund is invested abroad. The government must borrow funds to finance domestic lending and financial investment. One observation is that the prohibition would be more important if the assets in the Petroleum Fund were earmarked for a particular purpose and could not be used for general financing of government expenditures. But there are no plans for this. Today, more than 20 countries have adopted inflation targeting. Some of them have had an inflation target for more than 10 years, but many adopted inflation targeting after 1998. Which countries actually have inflation targeting and when they introduced this regime is open to discussion. The following chart is based on information from T. Pétursson of the Central Bank of Iceland.2 In New Zealand, the new monetary policy regime emerged as a solution to a practical problem.
And a few may view paper money – even the Bank of England itself – as archaic vestiges of an old centralised order of payments that will soon be swept aside by a digital, distributed future. And that’s my topic today: the future of money. Specifically, how developments in money and payments technologies could transform our economy in ways good and bad. And how, for the good of the people of the United Kingdom, the Bank of England is helping to manage the potential risks and to realise the promise of the future of money. What is money? In The Wealth of Nations, Adam Smith defines money by the roles it plays in society, in particular, how well it serves as:  -  A store of value with which to transfer purchasing power from today to some future time;  -  A medium of exchange with which to make payments for goods and services; and  -  A unit of account with which to measure the value of a particular good, service, saving or loan. These functions of money operate in a hierarchy (Figure 2). There are many assets that people view as stores of value — houses, for instance — that are not used as media of exchange. By comparison, an asset can only act as a medium of exchange if at least two people are prepared to treat it as a store of value, at least temporarily.

Dimitar Radev: Crisis management framework in Bulgaria Summary of statement by Mr Dimitar Radev, Governor of the Bulgarian National Bank, at the annual meeting of governors and other central bank representatives from the countries of the Dutch-Belgian constituency of the IMF, organised by the National Bank of Belgium, Brussels, 24 February 2017. * * * The closure of the fourth largest bank in Bulgaria in 2014 put to the test the country’s financial stability. This incident revealed, among other things, serious limitations in our crisis management arrangements in the banking area and, more specifically, the lack of a proper institutional framework to deal with resolution of systemically important banks. Our policy response to the 2014 crisis was incorporated in an 18-month plan adopted in mid2015, defining concrete actions in three priority areas: An independent assessment of: (1) the banks in Bulgaria (through an AQR and stress tests that were completed in 2016), and (2) our crisis management framework (through a still ongoing financial sector assessment, FSAP, by the International Monetary Fund and the World Bank); A comprehensive reform of the Central Bank’s banking supervision and regulation framework and practices, based on the Basel Core Principles (BCP); Introducing the BNB’s new bank resolution functions compliant with the European Bank Recovery and Resolution Directive (BRRD). The implementation of the plan helped build sound foundations for our crisis management framework.
It is worth spending a moment on this point because it has an important parallel in the issues concerning money market funds. Banks are primarily funded by deposits, where the contract is understood to be to return the full value of the deposit plus whatever the interest rate is – usually “on demand” and without delay. Banks are held to high standards by regulators – including through liquidity and capital requirements, and regular stress tests – to ensure that they are well placed to be able to honour depositors’ demands. Central bank liquidity operations, resolution arrangements and deposit insurance further reinforce confidence in this promise to return the deposit. Thanks to the post financial crisis reforms, bank deposits are therefore cash or moneylike in most states of the world. At the other end of this spectrum are investment funds of many sorts. Most are not meant to be cash-like, in the sense that the promise is to return the fruits of the investment strategy, which may be more or less than the amount invested. Cash-like certainty of value is not part of the contract. If only it was that simple. There are at least two problems which are evident in how this system operates – or possibly two variants of the same problem. First, there are instruments which at least in some of their existing forms are neither one thing nor the other – neither properly cashlike nor properly investment-like. Second, there are instruments which are meant to be investment-like but which become regarded as cash-like.

All these initiatives, coordinated with other policies, have proven effective. Inflation remains subdued and in check, inflationary expectations are anchored, macroeconomic environment is steady and financial stability is consolidated. Looking ahead, the Bank of Albania holds that the Albanian economy will continue to face the above-cited concerns over 2013 and beyond. Although improving, economic activity is expected to remain below its potential, followed by low inflationary pressures, creating premises for maintaining stimulating monetary conditions in the future. Likewise, our  BIS central bankers’ speeches  1  projections suggest that external balances of the economy are expected to improve. On the other hand, slow economic growth rates may generate pressures on debt stability indicators, unless they are identified and taken into consideration in fiscal policy decisions. In Bank of Albania’s view, growth rate recovery will require combining the cyclical stimulus of the economy with structural measures that expand the growth potential. Regarding the cyclical aspect, the Bank of Albania holds that macroeconomic policies are rightfully stimulating. In the absence of space, fiscal policy should continue to be oriented towards long-term stability of debt indicators. The monetary stimulus is expected to be transmitted more completely in the upcoming period. We continue to underline our message that businesses and consumers should have a more realistic approach on sound perspectives for the country’s development as well as revise up their consumption and investment plans.