samchain/econo-pairs-v1 huggingface dataset:
Meeting the target will depend on the numerous tax measures taking effect in the last quarter of the year ultimately yielding the expected returns, and on that offsetting the growth of debt service payments, unemployment benefits and pensions. Given the importance of meeting the deficit target in 2012, it should be foreseen that possible slippage in certain items may be offset with possible adjustments to others. The draft State Budget for 2013 sets an overall general government deficit target, in National Accounts terms, of 4.5% of GDP, in line with European commitments. That is down from 6.3% envisaged for 2012, excluding from that figure the impact of the measures to support banks which must be recorded this year (amounting to around 1 pp of GDP). The Budget envisages that the public debt ratio will increase from 85% of GDP in 2012  BIS central bankers’ speeches  3  (including € billion of FROB debt due to the drawdown in December of the credit line agreed with the European authorities) to 91% of GDP in 2013. The fiscal effort these targets entail is highly ambitious (around 2 pp in terms of the cyclically adjusted primary deficit), in a setting which will remain difficult. The macroeconomic scenario accompanying the budget envisages that GDP in real terms will contract 0.5%, as a result of the 2.8% fall in national demand which would be partly offset by a 2.3 pp contribution by the external sector.

In the area of credibility, it is highly advisable to define a multi-year  2  BIS central bankers’ speeches  budgetary time horizon which offers certainty to agents and, moreover, to deploy fiscal measures which combine actions with a short-term impact and others acting on the sustainability of public finances in the medium term, impinging, among others, on those expenditure items most affected by population ageing. Regional government finances Let me begin my analysis of the 2013 State budget by looking at regional government finances. Spain is today a country characterised by strongly decentralised public expenditure. On 2011 figures, central government accounted for 22% of total expenditure, social security for 32%, regional government for 34% and local government 12%. Thus, 46% of public expenditure was by regional and local government. With this structure of public expenditure, the setting of budgetary objectives for the various political and administrative tiers, on one hand, and the monitoring of their fulfilment, on the other, are two sides of the same coin. Both are fundamental in building the credibility of budgetary policy. Let me mention here what I consider to be an extremely significant advance. At the end of October the Ministry of Financial Affairs and Public Administration began to publish for the first time, as a result of the commitments made under the Stability Law, monthly data on the regional government budget outturns. As these figures become available regularly, in accordance with the related Law, the task of monitoring regional government expenditure will be made immensely easier.
Furthermore, volatile ISK assets held by non-residents currently total perhaps a fifth of GDP and could rise to almost half of GDP if the failed banks’ ISK assets are recovered in full and paid out to creditors. Iceland has no excess foreign exchange revenues with which to unwind these ISK positions, however. The solution lies in spreading out repayments of foreign loans, solving the ISK problem related to the settlement of the failed banks’ estates in a manner that does not exacerbate the balance of payments problem, and opening up market access to resident entities. A number of possible scenarios that could achieve this are under scrutiny at this time, but there is no need to discuss them in detail here. But if such measures generate the results we are aiming at, it is important to ensure that the impact on foreign debt service, whether in domestic or foreign currency, is manageable; to safeguard Iceland’s public debt position, sovereign credit ratings, and access to capital markets; and ultimately, to provide domestic entities with access to foreign credit on acceptable terms. Some of these goals may conflict with one another, and this should be considered when a course of action is chosen.

The overarching requirement for an Islamic financial institution is to ensure that its objectives and operations are in accordance with Shariah. In Malaysia, our experience suggests that mandating this requirement in the laws governing Islamic finance is fundamental not only in the context of defining the business scope of an Islamic financial institution, but also in preserving the sanctity of Shariah in Islamic finance. This legal mandate is also crucial for the Bank to take supervisory and regulatory remedy against an Islamic financial institution, which may include revocation of licence, in cases,  2  BIS Review 161/2010  where a violation by the institution poses reputational risk that might cause an erosion of confidence and could threaten the systemic stability of the Islamic financial system. The integrity and credibility of Shariah governance framework in Malaysia is also fundamentally supported by the role of the Bank’s Shariah Advisory Council (SAC), a centralized referral body for Islamic finance community, which is statutorily positioned as the highest authority in the determination of Shariah matters relating to Islamic finance. In preserving the sanctity of the Shariah, the SAC itself ensures the robustness of its rulings through a rigorous process before arriving at a decision. Another essential element in developing an effective legal infrastructure is the role of an adjudication system. A supportive adjudication system in the context of Islamic finance is one which can authoritatively enforce the principles of Shariah in dispute settlements involving Islamic financial transactions.
Moreover, unit labour cost growth has been low (2.0 % in 2003, coming down to around 0.7% in the first half of 2004) and it can be expected that it will be contained in the coming quarters by moderate wage developments and labour productivity gains. Notwithstanding these encouraging developments, there are still several upside risks to the outlook for price stability. These risks are mainly associated with oil price developments, possible new increases in indirect taxes and administered prices, and potential second-round effects stemming from wage and price-setting behaviour. The rise in measures of long-term inflation expectations in the euro area in the course of this year is also a cause of some concern. In addition, our monetary analysis points to upside risks to price stability. Since mid-summer, the dynamics of M3 have strengthened again, mainly reflecting continued strong demand for transaction balances, which are included in the narrow aggregate M1, the most liquid component of M3. The acceleration of money growth is driven by the stimulative effect of the historically low level of interest rates in the euro area. The low level of interest rates is also fuelling private sector demand for credit. In particular, the growth rate of loans for house purchase continues to rise in the euro area and is now approaching double digits. This goes hand in hand with relatively fast rises in real estate prices in many euro area countries. In recent months, the annual rate of growth of loans to non-financial corporations has also picked up.

During 2011, additional activities requested by banks and non-bank financial institutions were approved, consisting in introducing new market products and diversifying the existing products of financial institutions. Moreover, a preliminary approval was granted to new bank branches and agencies (10), but at low paces, whereas the activity of some bank branches and agencies was closed (11). As at year-end, there were 528 bank branches and agencies operating in the country and 1 branch operating abroad. Regarding supervision of the financial activity under the jurisdiction of the Bank of Albania, allow me to reiterate that it remains within the security parameters and is resilient to unexpected shocks. 6  BIS central bankers’ speeches  The Bank of Albania remains committed to monitoring the Albanian financial system rigorously and vigilantly, aiming at identifying early the potential risks and taking corrective measures to prevent them. Besides the foregoing directions of Bank of Albania’s work, I would proceed with some other activities of our work, which contribute not only to fulfilment of our legal tasks, but also to development of the financial system and market economy in Albania. 4. Other Bank of Albania activities    Bank of Albania’s role in the European integration  In the light of the objective for Albania’s integration in the European Union, the Bank of Albania has strived for aligning its activities and regulations with the European Union directives and standards.
Inflation and wage increase Annual percentage change 3  3  2.5  2.5 2018  Inflation  2  2  2011 2007  1.5  1.5  1  1  0.5  0.5  0  2.0  2.5  3.0 3.5 Wage increase  4.0  4.5  0  Note. Moving averages over 12 months. Sources: National Mediation Office, Statistics Sweden and the Riksbank  But what about the causal relationships? There sometimes appears to be a tendency to see wage increases as the source of all inflation. The perceived chain of events is that an increase in inflation is always preceded by a tighter labour market pushing up wage increases and companies then passing on the increased costs in the form of higher prices. Can we therefore expect modest wage increases to push down inflation going forward? No, such an unshakeable causal relationship between wage increases and inflation does not exist. It can just as easily be the case that stronger demand can allow companies to increase their prices. This increases their profits and margins, which in turn provides scope for them to raise wages. The interplay between prices, wages and activity in the economy – and of course a number of other variables, not least productivity – is complex. There are quite a few studies that have examined the links between wage increases and future inflation and whether wage increases tend to precede or lag behind inflation.

Sources: Statistics Sweden and the Riksbank  Of course, the correlation between the exchange rate and inflation is neither clear-cut nor straightforward. It depends, for example, on what has caused the exchange rate to fluctuate and how long it is expected to last. 6 But the fact that there is a correlation, insofar as a weakening of the exchange rate tends to result in rising inflation and vice versa, is obvious. Finally, it should be emphasised that monetary policy has of course been important in this development. From the ongoing debate, the impression can sometimes be that monetary policy does not play such a major role and that economic activity had been just as strong and inflation had been on target regardless of the policy conducted by the Riksbank. This is of course not the case. No causal relationship between wages and prices What then does the fact that inflation has risen but not wages actually signify? To begin with, and for the sake of completeness, we can also plot inflation against wage increases (see Figure 8). As we see, there is a tendency towards a positive correlation, at least periodically. See for instance the articles “The impact of the exchange rate on inflation” in the December 2016 Monetary Policy Report and “The exchange rate and inflation” in the April 2018 Monetary Policy Report. 6  13 [16]  Figure 8.
That is the impact of financial integration and how to deal with cross-border capital flows. Over the past two decades, the level of financial integration across countries has increased rapidly. If we take the total stock of external assets and liabilities relative to world GDP as a gauge of financial integration, in 1980 this stood at around a quarter, roughly equal to the ratio of global trade to world output. By 2010, global finance was nine times global trade. For emerging and developing countries, gross international assets and liabilities have increased by more than fivefold in the past ten years alone. For advanced economies, the expansion has been even more rapid. Accompanying the trend increase in financial integration has been a large expansion in gross capital flows as well as an increase in the volatility of those flows. Periods of synchronized asset price volatility across countries and regions have become more prevalent. There is increasing talk of a global financial cycle driven, in part, by US monetary policy. This has led to an active debate about the impact of financial integration on individual countries’ ability to manage domestic financial conditions. Does increased financial integration limit the effectiveness of monetary control? How should countries respond to increased capital flows? Is there room for policy coordination? Let me say at the outset that there are no clear cut solutions. There is a large academic literature that discusses the pros and cons of various instruments, such as capital controls and macroprudential measures. I will not discuss these at length.

With the affordability and availability of many powerful financial technologies, there is no better time for us to improve on our productivity, immunity, and inclusivity so that we can ensure sustainable improvement in the standard of living our people. I am certain the contributions from the ACMECS leaders present here today will go a long way towards fulfilling our common goal. Thank you very much for your kind attention. 5/5
A clear articulation of the FOMC’s goals and an explanation of how it views its policy misses and plans to correct them help the public better anticipate the Fed’s policy actions. In turn, the public’s improved understanding of FOMC policy actions increases their efficacy by reducing uncertainty over future financial conditions and how those actions might evolve with changes in the economic environment. So, what we clearly need is a scorecard that communicates our accountability in a straightforward manner. Keeping score when there are two goals  I like to illustrate our balanced approach to achieving our dual-mandate goals with what I refer to as a bull’s-eye scorecard (chart 3). The bull’s-eye in the center illustrates where we would like to be. In this case, the goals are 2 percent inflation over the medium term and unemployment at its natural rate, taken here to be 5–1/4 percent, which is my long-run projection. The scorecard shows an equal weighting of policy misses around our inflation and unemployment objectives; that is, each circular ring is a collection of unemployment and inflation rates that should be equally uncomfortable for FOMC participants. 3 For example, it tells us how the 9 percent unemployment rate we faced back in September 2011 can be depicted in “inflation-loss equivalent units” by showing the inflation rate that gives an equivalent loss when unemployment is at its sustainable rate. The answer is 5–1/2 percent inflation!

In any event, the FOMC’s latest policy statement in March recognizes this possibility of lower real rates, as the Committee stated it currently anticipates that “even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target fed funds rate below levels the Committee views as normal in the longer run.” 12  9  Taylor (1993), p. 197. 10  Taylor (1979). 11  See Summers (2013) and Krugman (2013). 12  Federal Open Market Committee (2014a). 8  BIS central bankers’ speeches  Conclusion During Ben Bernanke’s eight years as Fed Chair, the FOMC worked hard to make the Fed’s policy intentions clear; and I am confident that the FOMC under Chair Yellen will continue along this same path. When the federal funds rate got stuck at zero and goal-oriented monetary policy said to do more, we did more! We implemented the following: the first quantitative easing program, or QE1, in March 2009; 13 QE2 in fall 2010; the initial forward guidance on the federal funds rate in August 2011; Operation Twist in fall 2011; the openended QE3 in fall 2012; and the enhanced threshold forward guidance in December 2012. All of these were ways to go beyond the policy inaction that was the prescription of simple constrained policy rules, and do something to meet our policy mandates. In conclusion, let me ask again, what is the accountability test?
Mobile phone payments account for nearly three out of four payments between private individuals. It’s a short step to other new technologies. Facial recognition and fingerprint technologies are being incorporated into payment solutions. In the United States, Amazon has opened a shop where customers hardly notice paying while on their way out. Sensors ensure that the items are paid for. For Kristoffer paying for goods was even simpler. His electronic assistant saw to both ordering and paying. This may become commonplace in a few years. Traditionally, Norwegian banks have shown a strong adaptation capacity and have been drivers and early adopters of new payment technologies. Many of the solutions we use today have been developed by Norwegian banks – often in collaboration with each other. Banks’ role in the payment system is being challenged. Small specialist operators and global tech giants have their eye on payment services. Some of these may integrate proprietary payment solutions for purchasing goods and services online. New regulations in the pipeline will facilitate increased competition. Banks will have to give other operators direct access to the account system so that customers can freely choose among payment providers. In a few years, it may be possible to transfer funds automatically between accounts and digital platforms based on a person’s transaction data.6 In response to greater competition, banks should further develop existing services and offer new solutions. There is still room to speed up payments. Payment costs are substantial for businesses.

Ardian Fullani: Economic and monetary developments in Albania Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the press conference on the decision of the Supervisory Council of the Bank of Albania, Tirana, 25 November 2009. *  *  *  In its meeting of November 25, 2009, the Supervisory Council of the Bank of Albania analysed “The Monetary Policy Report for November 2009”. After becoming acquainted with the latest economic and financial developments at home, and following the discussions related to their expected performance in the future, the Supervisory Council of the Bank of Albania decided to keep the key interest rate unchanged, at 5.25 percent. The Supervisory Council assessed that this interest rate is in line with Bank of Albania’s goal to keep inflation close to the target over the medium run. *** Economic and monetary developments over the latest months are featured by low inflationary pressures. Annual consumer-price inflation for October recorded 2.3 percent, being almost in line with its performance over the last quarter. The steady and low inflation rate has been conditioned by moderate pressures from domestic economy, due to: •  Economic activity slowdown during this period;  •  Low exchange rate pass-through of exchange rate depreciation on Lek prices of import goods; and  •  Stabilized inflationary expectations. Easing of monetary conditions by the Bank of Albania, through key interest rate cut in October and continuation of liquidity injecting operations have provided appropriate impulses for promoting the economic activity in the future.
In addition, we consider other relevant information that is available, not least the exchange rate that can be said to be more fundamentally reasonable. Which of these three approaches is most appropriate - given that game situations and the risk of sudden shifts could be disregarded - is not self-evident. Personally I cannot see why we should not treat the exchange rate in much the same way as other forecast variables. We normally try to consider all the relevant information that can be gathered on a particular variable. It seems reasonable to do so in this case, too. Another matter is the considerable degree of uncertainty that surrounds virtually all forecast variables and particularly the exchange rate. That is why we also produce an assessment of risks. Our policy is then based on an overall assessment, including a valuation of the various risks. Exchange rate theories It is often said that for the conduct of economic policy, the best help in practice is a good theory. In the case of exchange rates, however, the relevant theories have not been particularly successful at either explaining or predicting movements of the Swedish krona or other currencies in recent years. A basic difficulty with theories for determining exchange rates is the fact that an exchange rate is a nominal price, whereas economic analysis is constructed to explain relative prices.

National balance sheets and the crisis Recently, when events have centred on the euro area, the focus has been on the risk of sovereign default. The underlying issue is the cumulative loss of competitiveness of some economies, and the consequent strains in government balance sheets resulting from their attempts over the years to use fiscal policy to sustain growth. A look at Spain’s external balance sheet reveals (net) liabilities of around 100% of GDP (Chart 1). Italy’s net external liabilities are, perhaps, rather smaller than that (Chart 2). But in terms of total government debt, Italy’s new administration inherited the greater burden. Put those two facts together and it becomes clear that Italy’s fiscal problem is partly about the distribution of debt and resources within the country. Japan is, perhaps, not dissimilar. Go back four-five years, to the beginning of the crisis, and the problem was the mortgage obligations of US households – subprime households in particular were hugely over borrowed. The commercial real estate sector too. Defaults there triggered the crisis. Every set of defaults and problems around the world has reverberated through the UK, due to London’s role in intermediating international capital flows. We have one of the largest gross external balance sheets (Chart 3). Although much of it is accounted for by foreign banking activity, the City is not an entrepôt. UK banking is linked to the wider City’s fortunes via complex counterparty-credit exposures and investments.