samchain/econo-pairs-v1 huggingface dataset:
12  See TNS SIFO Prospera’s surveys of expectations of inflation and GDP growth among money market participants in 2009. See also Lars E.O. Svensson (2010), “Policy expectations and policy evaluations: the role of transparency and communication” Sveriges Riksbank Economic Review, No. 1, 2010. 20  BIS Review 32/2010  Monetary policy has mitigated the effects of the crisis The Riksbank has reacted forcefully and successfully to the major shocks that have occurred since the autumn of 2008 – even if I personally, as revealed by my reservations during the course of 2009, would have liked to have seen the Riksbank react even more forcefully and thus stabilise inflation and resource utilisation even better. The global recession that followed in the wake of the financial crisis surprised us all and was met by a marked shift in monetary policy that entailed rapid and repeated cuts in the repo rate up to the summer of 2009. The repo-rate cuts led to lower mortgage rates, which in turn pushed down CPI inflation. However, the cuts helped to keep CPIF inflation close to the target. The series of repo-rate cuts that began in the autumn of 2008 was necessary in order to mitigate the effects of the financial crisis on the real economy and to achieve a better attainment of the inflation target. Without these substantial reductions in the repo rate, GDP would have fallen even more. Monetary policy was also complemented by extensive lending to the banks.

The financial education course was not detected, however, to have any significant impact on pupils’ decision to have a bank account or card, or on the amount of money they report they save weekly. The financial education course did significantly raise the proportion of pupils who talk to their parents about economic matters. After having followed the course, the percentage of pupils doing a job at home to obtain income also increased, which suggests that financial education may lead to greater pupil involvement in their household’s financial matters. A change in pupils’ attitudes was detected regarding their temporary consumption preferences six months after the financial education course, with their “patience” increasing when it came to hypothetical money choices. This observed result did not disappear in an exercise performed three months afterwards, in which it was  8  An initial pilot programme was carried out in 2010-2011. Bover, O., L. Hospido and E. Villanueva (2018): "The Impact of High School Financial Education on Financial Knowledge and Choices: Evidence from a Randomized Trial in Spain", Banco de España WP 1801. 9  7/8  proposed to students that they distribute their present and future consumption with real payments.10 These results point to the pertinence of monitoring over time the pupils evaluated, with the aim of analysing the effects of financial education in the long term. This is in light of the potential significance of consumer attitudes in financial decision-making throughout the life-cycle of individuals.
And the rate of unemployment fell from a peak of over 10½% on the LFS measure to around 5% last summer; on the claimant count measure it fell from some 10% to just over 3%, which meant that the number of people claiming unemployment benefit, at under 950,000, was the lowest for 26 years. Short-term interest rates are at a 38-year low. All of that it seems to me gives the lie to a view that was quite widespread a decade ago, that sustained low inflation would inevitably mean continuous suppression of the real economy. I'd go further myself and suggest that it provides considerable positive support for the central bankers' credo. Now some of you - given what's been happening to your own businesses, to certain particular business sectors, and in regions of the country where those sectors are particularly heavily concentrated - may think that I've been living on a different planet. The problem is - and it is a real problem - that with the best will in the world macro-economic stability, the stability of the economy as a whole, cannot guarantee stability at the more micro-economic level: it can not guarantee the prosperity of every individual business or even of whole business sectors or geographic regions.

Prior to the introduction of inflation targeting in 1992, the UK had searched – in vain – to find a credible anchor for monetary policy and inflation expectations. The simplicity and clarity provided by a numerical target for inflation helped to establish the credibility of monetary policy and was instrumental in fostering the period of stable growth and low inflation enjoyed in the decade or so prior to the financial crisis. But in the aftermath of the crisis and faced with five years of almost no growth, it is natural for people to ask what monetary policy is doing to help get the economy going. The control of inflation is important but so too is supporting the creation of jobs as unemployment rose to its highest level for almost twenty years. There was a real risk that this would start to erode the trust and support of inflation targeting; to damage its democratic legitimacy. This was arguably evident earlier this year in the discussions in the media and amongst some commentators as to whether the framework of monetary policy should be altered, say to adopt a nominal GDP target or for the MPC to have an explicit objective for growth. A subtext of that discussion was that the inflation target was in some way acting as a constraint on the support that monetary policy could provide to the faltering recovery. To repeat: such criticism is misplaced.
That reflects the strong dynamism of exports, driven in recent months by the improvement in Spanish competitiveness and the buoyancy of the euro area markets; but it is also indicative of the weakness of domestic expenditure, giving rise to the contractionary behaviour of imports. As a consequence of these developments, Spain will show a net lending position against the rest of the world of around 2% of GDP, an unprecedented and record figure in recent decades. Over the past months, inflation, proxied by the CPI, has been declining notably, essentially as a result of the tapering off of the effects of the VAT increase over more than a year back. Thus, in October, the CPI fell by 0.1%. Foreseeably, however, positive though moderate rates of change will resume in the coming months, therefore proving compatible with the necessary continuation of the ongoing improvement in competitiveness our economy requires. For 2014, a central scenario has been outlined in which the factors that have been affecting domestic demand progressively slacken. It is projected that the processes of adjustment in the economy, and most particularly the redressing of private-sector debt and the ongoing fiscal consolidation, will continue to influence the pace of recovery of demand and activity; but, at the same time, the reduction in uncertainty and the culmination of the restructuring of credit institutions, along with their improved results, will lay the foundations for improving financial conditions for the resident sectors.

The budgetary plan projects maintaining the weight of public investment as a percentage of GDP, following the cuts seen in recent years; that said, the cuts would be prolonged in the case of the State. Likewise, the envisaged revision of pensions is set at 0.25%, in line with the floor set in the draft law defining the sustainability factor. As in previous years, the main challenges surrounding the budgetary projections arise from the course public revenue may take; despite the projected gradual recovery in activity and some re-balancing of the attendant growth factors, revenue will remain considerably influenced by the greater relative weight of exports and by the moderation of wage income, which will limit the response by public revenue to greater activity. To conclude, I have a comment on public debt and its implications for the fiscal drive still to be made. On official projections, the public debt/GDP ratio might rise to 98.9% in 2014 and stand above 100% in 2015, beginning to turn down in subsequent years. Placing public debt below the ceilings set by the Stability and Growth Pact and the Stability Law will, in any event, require that high primary surpluses be maintained over a prolonged period of time. This is the indicator that best illustrates the scale of the challenges still ahead for us. It also highlights the importance of successfully seeing through fiscal consolidation and structural reform, so that the ongoing reduction in budgetary imbalances may combine with an improvement in our potential growth.
Central banks can also contribute to the function of money markets more broadly, by being willing to act early to address potential liquidity needs, and to support money market infrastructure more generally. I’ll end with a word on central banks’ “footprint.” Many of the developments raised in the paper and that will be discussed over the course of this conference have been a response to the needs of the day: having more reserves in the system is a reflection of the monetary policy stance required by economic developments; the leverage ratio has been developed as a part of the response to failure of the pre-crisis capital framework; and our intervention in risk-free benchmark rates is intended to avoid a co-ordination failure in which the most appropriate and robust benchmarks would not be adopted by the market. So while it is true to say that central banks’ footprint in money markets is larger now than in the days prior to the crisis, this has been out of necessity rather than design. As a tribe, central bankers retain a strong belief in financial markets’ ability to facilitate price discovery, allocate capital efficiently, and provide useful signals about the macro economy and financial stability. References Duffie, D and Krishnamurthy, A (2016), “Passthrough efficiency in the Fed’s New Monetary Policy Setting”, Preliminary version for presentation at the 2016 Jackson Hole Symposium. Fender, I and Lewrick, U (2015), “Calibrating the leverage ratio”, BIS Quarterly Review, December, pages 43–58.

This process of reducing unintended consequences is made easier by close co-ordination of different policymakers, which at the Bank of England is facilitated by having monetary, macro- and micro-prudential policy all under one roof. The role of central banks in money markets Let me turn to the role of central banks as a participant in money markets. Just as private market participants have grappled with new challenges in the post-crisis world, so too have central banks. And we have responded in three ways. First, we have become more flexible in the way we implement changes in the policy rate. The frameworks we use to influence market rates need to recognise the fact that there are a lot more reserves in the system than before, and that regulation has reduced the incentive to arbitrage small differences in money market rates. As the paper sets out, the Fed’s RRP is a good example of adapting to this new reality. The facility improves pass-through efficiency by offering a risk-free asset to a broad range of counterparties that extends beyond banks, thus strengthening the floor on money market rates more generally. The counterpart to this facility in the UK is our ability to issue Bank of England bills, though thus far we haven’t had the need to do so: since we began paying Bank Rate on all reserves in 2009 the wedge between overnight unsecured money market rates and Bank rate has averaged 4bps, and the standard deviation also been 4bps (Chart 6).
Luis M Linde: Islamic finance – growing importance and regulatory challenge Welcoming remarks by Mr Luis M Linde, Governor of the Bank of Spain, at the European Forum on Islamic Finance, organized by the Islamic Financial Services Board (Madrid), Madrid, 24 May 2016. *  *  *  Mr. Jaseem Ahmed, Secretary-General of the Islamic Financial Services Board (IFSB); Mr. Guillermo de la Dehesa, Chairman of the International Advisory Board of IE Business School; colleagues, ladies and gentlemen: It is a pleasure for me to welcome you all to the European Forum on Islamic Finance. This is the fifth European Forum since 2005, after the previous fora in Luxembourg, Germany, France and Italy. Following the tradition established by other European central banks, we are glad to support this event, organised by the IFSB. I would also like to thank the IE Business School for their hospitality in hosting the Forum in Madrid today. The purpose of this European Forum is to gain a better grasp of the specifics of Islamic Finance and its development, which has been particularly noticeable in the last decade. In this respect, I would like to stress two relevant aspects of Islamic Finance in my opening remarks: FIRST, its growing importance in international finance; and SECOND, the ongoing regulatory efforts to facilitate its insertion in international markets.

In this area, Islamic finance instruments will have to comply with conventional or general financial regulation, while maintaining their specificities. In particular, the contractbased nature of Islamic finance normally linked to an underlying asset poses challenges in areas such as risk weight analysis and the fiscal treatment of Islamic-type instruments. BIS central bankers’ speeches  1  Financial instruments have to be carefully calibrated to take due account of the risks linked to the underlying asset and its liquidity. In taxation, there are problems of double or multiple taxation and equality of treatment with interest-based instruments that also need to be addressed. Several European countries are adapting their legislation in this respect. In addressing these regulatory challenges, the IFSB is playing a very important role by providing a forum for coordination and dissemination of better international practices. It is also contributing to the integration of Islamic finance into the general framework of conventional finance regulation, as established by international bodies, such as the FSB itself and the Basel Committee on Banking Supervision. In parallel, other institutions such as the G20, the IMF and the World Bank are stepping up their efforts to further the analysis of Islamic finance and to identify the necessary reforms to its insertion in the international financial system. Many of these issues will be dealt with in the different sessions of today´s Forum. The agenda includes four technical sessions on regulatory aspects and the specific challenges regarding Sukuk markets, equity-based financing and financial inclusion.
If confirmed, this would be bad news for the European economy that needs investment following years of underinvestment in the aftermath of the global financial crisis. Moroever, the question is how the financial sector would react. What exactly do you mean by that? The financial sector often tends to act procyclically. Banks are a case in point, because they tend to amplify cyclical developments. When the economy is performing well, they are willing to grant credit, but when it is faltering, they are not so keen. Do you see such a risk at present? As far as the capital markets are concerned, credit risk premia have increased significantly over the past months – for both high and low credit-rated firms. That tightens borrowing conditions for firms on capital markets and weighs on the economy. On the other hand we have so far not seen any such tightening in bank lending conditions in the euro area. Overall, in light of these developments, we consider that the probability of a recession remains low. But are you worried that that will change, that the banks will tighten conditions too? Banks in the euro area now hold much more capital than before and are better able to withstand shocks. They also have larger liquidity buffers. That’s all good news. At the same time, bank equity prices have fallen sharply and profitability is often very low, as is also reflected in the banks’ very low price-to-book ratio of around 50%.

François Villeroy de Galhau: Developments in Europe against the background of global uncertainties Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Paris Europlace International Financial Forum, New York City, 18 April 2016. *  *  *  In 2016, the world in general, and Europe in particular, is experiencing a period of uncertainty: uncertainties relating to our security, with the threat of terrorist attacks; political uncertainties, with the risk of a “Brexit” and the refugee crisis; as well as economic uncertainties, with lower economic growth in emerging economies, including China, and high market volatility at the beginning of the year. Nevertheless, recovery is underway in Europe. As you may know, a meeting of the ECB Governing Council will be held in two days, so I have to respect a silent period on monetary policy matters. But I can emphasize that, in response to weak inflation and heightened uncertainties, the Eurosystem, of which the Banque de France is a member, has been acting decisively. And European countries have been implementing structural reforms since the onset of the crisis. Those national efforts are crucial, but we need to go further with more coordination: coordination to direct savings towards projects and countries that need them; coordination of the reforms themselves at the European level.
I have discussed elsewhere (King, 2001) the potential importance of money in reducing the transactions costs of firms by reducing liquidity premia in a wide range of financial markets. There is much to learn here. (ii)  Incomplete indexation of the tax system  A second cost of anticipated inflation is the added inefficiencies that arise when an already distortionary tax system is incompletely indexed. Martin Feldstein (1999) has edited a major study of the costs of incomplete indexation which includes a detailed analysis of the tax distortions to saving, consumption and investment in several major countries, and to which the Bank of England contributed. The benefit of reducing inflation in an already low inflation environment is estimated to be lower in the UK than in some other countries because some parts of the tax system are indexed. Nevertheless, the authors estimate that a reduction in inflation by 2 percentage points would bring an annual benefit equivalent to 0.2% of GDP. That may sound small, but it is a large absolute number. Against that, the end of mortgage interest deductibility will have lowered the impact. (iii)  Front-end loading of debt burdens  A third distortion is that of front-loading of the real debt burden when debt contracts are fixed in nominal terms. Inflation reduces the amount that households borrow because it raises the cost of servicing the loan in the early years. In this way decisions on consumption and investment may be distorted.

To illustrate the problems of  12  BIS Review 68/2002  measuring inflation, I shall draw largely on historic price material kindly provided by Harrods - mainly the Catalogues, Harrods News, and Harrods Food News. No records were published after 1970, so we have supplemented the historical data by our own researches. And I am very grateful to the young Bank of England economist who was apprehended in the Food Hall, suspected of comparing prices for a competitor who was opening a store across the road. The richness of this information can be seen from the size of the Catalogue for 1907 - weighing over six pounds and containing 1375 pages. In those days the telegraphic address of Harrods was “Everything, London”. The Internet has nothing on Harrods in 1907 when a telephone service with real people answering was available to take orders right through the night which were despatched early the next day with free local delivery (as far as Windsor) and by mail elsewhere. According to the catalogues, a record player in Harrods cost £ in 1910 (approximately £ in today’s money). That would have bought you a hand-cranked machine that provided low-quality sound. Today, you could buy a record player for as little as £ on the Internet, and at Harrods a better quality model for £ How much have record-players increased in price?
Undergraduate opportunities to study Islamic finance or Shariah, either as a speciality or a major component of a business degree, should be readily available at local and foreign universities. The challenge is to provide programmes which keep pace with changes in financial innovation and technology. Meeting this need requires rigorous, extended programmes such as the post-graduate programmes in Islamic Finance and Financial Engineering with emphasis on Islamic banking principles. At the same time, relevant organizations can support such programmes by creating funds to sponsor promising students to pursue formal education, ranging from modular courses in Islamic finance to full post-graduate programmes. There is also a need to increase programmes and initiatives that provide education and training in Shariah. Islamic research organizations and financial institutions need to work towards developing a sufficient number of competent Shariah scholars who are equipped with sound knowledge and expertise in both Islamic jurisprudence and Islamic commercial laws to deal with innovative and cutting-edge products. There is also the need for extensive education of the consumer and business community. This would increase the outreach resulting in increased demand for new and innovative products and approaches. Malaysia has implemented a 10-year structured consumer education programme to increase the level of consumer awareness on the unique characteristics of Islamic financial products and the product choices offered by Islamic financial service providers. Increased awareness will drive the demand for a broader range of Islamic products and services customized to their requirements at more competitive prices and through more convenient channels.

To this end, it uses a variety of models and empirical approaches, and also conducts its own surveys. In addition, the SNB analyses economic indicators for Switzerland and abroad, and follows the assessments and forecasts of other institutions. KOF Swiss Economic Institute at the Swiss Federal Institute for Technology Zurich (ETH) is without doubt the best-known for economic analysis. It makes a significant contribution towards understanding the Swiss economy with its regular data surveys (for example, the survey of companies it has been systematically conducting since 1955), as well as its economic forecasts and special analyses. In doing so, KOF fulfils an important role for the SNB's monetary policy and, ultimately, for the greater good of our country. For this reason, the SNB has been connected with the KOF Swiss Economic Institute since its beginning in the 1930s. Both institutions maintain a stimulating exchange of information and ideas to this day. With high-quality economic analysis closely linked to scientific research, KOF Swiss Economic Institute will continue to make a valuable contribution in future - to ensure an even better understanding of the Swiss economy. BIS central bankers’ speeches  1