samchain/econo-pairs-v1 huggingface dataset:
My assessment is, nevertheless, that they will decline as economic activity weakens and the actual rate of inflation falls. To sum up it can be said that the Executive Board agreed on a great deal – that economic activity is weakening, that inflation is declining and that it will be possible to reduce the interest rate in the period ahead. Our disagreements related primarily to our different assessments of the strength of the processes and of how much monetary policy would need to help to reduce inflation. My final assessment was that inflation in the period ahead will move towards the target, in roughly the same way as illustrated in the Monetary Policy Update, without the need to increase the interest rate. I thus voted to leave the repo rate unchanged. Nor did I support the repo rate path presented in the Monetary Policy Update. The path had been lowered compared to the assessment made in July. But I felt that the force of the economic downswing may easily make it necessary to reduce the interest rate more than is indicated in the new path. 4  BIS Review 113/2008  New statistics and developments on the financial markets Some important statistics have been published since we made our decision on the interest rate. These include the inflation figures for August which showed that the CPI increased by 4.3 per cent over the last 12 months. This was 0.2 percentage points lower than our forecast in the Monetary Policy Update.

Source: Financial Services Register Staff total correct as at end-September 2016. 2  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  2  In financial services here in the UK we have a mixed economy. The aim is that firms are owned privately (by their shareholders or members) and run for private interests, but within a framework of regulation which makes them internalise our objectives and therefore accommodate the public interest. This system is based on the premise that a healthy element of risk-taking in the financial system is an essential part of a well-functioning economy, but that such risk-taking may become excessive without some kind of check. Few people I know seriously contest that basic premise. But firms frequently contest how we are going about securing the public interest. That tension is natural, given the system we have chosen. There inevitably are and will be significant frictional costs, as the objectives of supervisors, employees, shareholders, members, creditors and customers jostle alongside one another. This means there will be disagreements. But we shouldn’t disagree without having made a real effort to understand each other’s perspectives. I am convinced that this system (including the judgement-based, forward-looking supervisory model we have adopted for the PRA), while imperfect, is much better than the alternatives of a financial sector owned by the taxpayer or a laissez-faire, tick-box regime – especially because history teaches us that the latter may well lead to the former.
Considering the price stability objective stipulated in the Sveriges Riksbank Act and the stance taken in the preparatory work, it can be concluded that monetary policy should be aimed at stabilising inflation around the inflation target and resource utilisation around a normal level. This is called flexible inflation-targeting in the terminology I proposed in a number of papers published in the 1990s (Svensson 1999). This is, incidentally, completely in line with the stance adopted by the parliamentary Committee on Finance in 2007, in its comments on the evaluation of monetary policy in the period 1995–2005 by Francesco Giavazzi and Frederic Mishkin (2006/07:FiU27): “The Committee maintains that Swedish monetary policy should be conducted in a flexible way and should aim to stabilise the development of inflation, employment and production.”  BIS Review 22/2010  1  This being so, some people may wonder: Wouldn’t it be better to have a level of resource utilisation that is higher than normal? Shouldn’t monetary policy be aimed at achieving a higher level of resource utilisation than normal? Well, you may think so – but 40 years of practical experience and 30 years of theoretical and empirical research have produced overwhelming evidence that monetary policy alone cannot bring about a higher than normal level of resource utilisation. Making attempts through a more expansionary monetary policy will not lead to success in increasing resource utilisation and employment.

Mean squared gaps (output) Production  Higher  6.0 4.0  Main  Per cent  -1.0  Lower  -2.0 -3.0 -4.0 -5.0  0.20  0.40 CPIF  0.60  08  0.80  c. Mean squared gaps (hours)  09  3.0  10  11  12  f. Hours-worked gap 2.0  4.0  Hours  12  0.0  2.0 0.0 0.00  11  e. Output gap 1.0  8.0  10  Per cent  1.0  Higher  0.0 2.0 1.0  -1.0  Main  -2.0  Lower 0.0 0.00  -3.0 0.20  0.40 CPIF  0.60  Main  08  0.80  Lower  09  10  11  12  Higher  To determine which repo rate path is most appropriate, a comparison must be made of the forecast for inflation and resource utilisation for alternative repo rate paths. Such a comparison is presented in Figures 2.13–2.15 at the end of Chapter 2 of the Monetary Policy Report. I present a similar comparison here in Figure 1. Figure 1 shows the consequences of alternative repo rate paths for the forecast for inflation and resource utilisation. The different repo rate paths are shown in panel a. In the middle is the main scenario’s repo rate path – the repo rate path that the Executive Board majority chose at the meeting in February.
Ladies and Gentlemen, In the Turkish context, the Islamic finance practices are embodied in a uniquely defined compartment of the banking system. These banks are called as the “participation banks” in Turkey and they constitute an integral part of the Turkish banking system. There are four Islamic banks categorized as participation banks, and 45 conventional banks in Turkey as of  BIS Review 124/2009  1  September 2009. It is crucial to highlight that the participation banks are not considered as an alternative to the conventional banks. While they are functioning similar to deposit banks, their fund collecting and lending processes differ significantly. Participation banks are authorized by the Turkish Banking Act to collect funds from the public under the “profit and loss participation accounts” and the “special current accounts”. The profit and loss participation accounts are essentially a version of the Islamic financial instrument, where the bank utilizes the funds deposited by account holders to fund specific business activities. Any profits earned are shared between the account holder and the bank, in proportion to an agreed ratio. Participation banks in Turkey mainly offer two types of lending. The first type of financing is Murabaha, which is a transaction consisting of two sales contracts. The first contract involves a bank client requesting the bank to undertake a Murabaha transaction and promising to buy the commodity specified by him or her if the bank acquires that commodity.

Connectivity among centralised Shariah advisory authorities The final point is on increasing connectivity among centralised Shariah advisory authorities to promote mutual respect and knowledge-sharing. Islam has flourished with a strong foundation of knowledge, wisdom and tolerance among its scholars. Differences in ideas and open discourses to assess the veracity of knowledge – have always been practiced in many Islamic societies. While achieving consensus is ideal – full appreciation of differences in circumstances and considerations is equally important and necessary. I have observed over the years that the implementation of Islamic finance varies from one jurisdiction to another. Rightly so, this reflects the different stages of development and diversity in local customs, market conventions and cultural norms. I believe through frequent and constructive dialogue, Shariah boards and advisory authorities will become more appreciative of the many differences in business and economic environment – that lead to different Shariah interpretations. Concerted efforts to cultivate greater understanding of the variations in fiqh interpretations and approaches to Islamic finance development are positive steps towards harmonisation that can deliver certainty of Shariah implementation in the global Islamic financial system. This roundtable meeting organised today is just a starting point of a long journey. It is my hope that this meeting offers a productive networking opportunity for all of us to identify common issues; explore mutually beneficial opportunities; and implement positive changes in our financial systems.
Jarle Bergo: Monetary policy and the cyclical situation Speech by Mr Jarle Bergo, Deputy Governor of Norges Bank (Central Bank of Norway), at a meeting with local authorities and the business community, Kapp, 23 November 2005. Please note that the text below may differ slightly from the actual presentation. The address is based on the assessments presented at Norges Bank’s press conference following the Executive Board’s monetary policy meeting on 2 November, Inflation Report 3/05 and on previous speeches. Charts in pdf-format can be found on the website of the Norges Bank. *  *  *  The economic situation The cyclical upturn in the Norwegian economy continues. Overall capacity utilisation in the economy has increased. After a period of very low consumer price inflation, there are prospects that inflation will again rise at a faster pace. Interest-rate setting since this spring has been oriented towards a gradual increase in the interest rate – in small, not too frequent steps – towards a more normal level. On the basis of the analysis in Inflation Report 3/05, this strategy still appears to provide a reasonable balance between the objectives of monetary policy. The reduction in Norges Bank’s key rate through 2003 and into 2004 resulted in low interest rates. At the beginning of the recovery, falling interest rates and expectations of low real interest rates ahead fuelled private consumption. A weaker krone exchange rate and the international recovery stimulated traditional merchandise exports.

Along this perfectly understandable line of reasoning, avoiding moral hazard, the UK Financial Services Compensation Scheme, in accordance with the European directive then in force, covered in full the first £ deposit but only 90pc of the next £ The Northern Rock crisis showed in a dramatic way that such a scheme was totally ineffective in preventing a bank run. Almost at the other end of the spectrum of possibilities, the Irish decision, in September 2008, to increase its deposit insurance to an unlimited amount, triggered a transfer of savings from other countries, especially from the UK, and from branches of non-Irish banks operating in Ireland to Irish banks. It contributed to Ireland's financial debacle and illustrated the need for an international cooperative stance with regard to deposit insurance. Since then we have introduced in Europe a resolution scheme that changes dramatically the hierarchy of creditors and modifies profoundly the risks for small depositors and the purpose of a deposit insurance regime. There is no crisis-proof deposit insurance scheme and this conference has been a very welcome opportunity to discuss the various models, share experiences, compare principles, governance and operating methods. Thank you all for your useful testimonies today. We all share ambitious objectives: to address crisis situations, manage the multicultural framework in times of crisis, handle cross-border resolution cases, and structure Deposit Insurance Schemes to deal with such events and ensure payouts. To achieve these objectives, international cooperation, even though it may sometimes be difficult to implement, can be highly beneficial.
We have seen an almost unprecedented series of such disturbances – unprecedented certainly in modern times. I am going to pick out four which have been at work in the last two and a half years and discuss them in broadly chronological order. I will start with the onset of Covid over two years ago now and its subsequent waves. It is worth briefly recalling the precipitous drop in economic activity at that time, and the speculation that it would be the largest drop in three hundred years. In the end it was very big, but not quite that big. It required a very large response from macroeconomic policy. Monetary and fiscal policy both acted to counter the cyclical downturn, reinforcing one another even as they were implemented independently. Moreover, the response had to be sustained because of the sheer scale of the uncertainty around the impact of further waves of Covid. It is worth recalling that the key aim of policy was to support businesses and households through the crisis, limiting lasting damage to the economy – which could have been compromised by a premature withdrawal of stimulus. Without that policy support, the economy today would be in a much worse position. Moreover, policy is necessarily made in real time, not in hindsight. Remember that we started with no functioning vaccine and the previous average time to implement one for viruses of this nature was 10 years. The second disturbance came with the recovery from Covid.

Moreover, in view of the improved international liquidity conditions and the increase in foreign exchange liquidity of the banking system, our Bank has terminated its intermediary role in the Foreign Exchange Deposit Market as of October 15, 2010. In addition, the maturity of the foreign exchange deposits borrowed within the pre-determined borrowing limits by banks from the CBRT was reduced to one week, as was the case before October 2008. Distinguished Guests, 43. The quantitative easing adopted in the last quarter of 2010 by some major central banks and the consequent boost in capital flows to emerging markets have necessitated significant changes to our monetary policy strategy. Short-term capital inflows feeding the divergence between domestic and external demand caused current account deficit to widen rapidly, thus necessitating macroprudential measures. Hence, we jointly use liquidity management facilities and reserve requirements as well as policy rates in order to achieve price stability and financial stability. 14  BIS central bankers’ speeches  44. In line with the new policy design, the TL required reserve ratio was raised by 0.50 points each in September and November to 6 percent. Additionally, in order to more effectively use the required reserve ratio as a tool to contain macroeconomic and financial risks, interest payments on TL reserve requirements was terminated in September. 45. Due to the accelerated capital inflows, our Bank reduced its overnight borrowing rate from 5.75 percent to 1.50 percent in November, and increased the lending rate by 0.25 points to 9 percent. Late liquidity window rates were accordingly revised.
In any event, since the global financial crisis, the sector’s ROE has remained systematically below the cost of capital, offering yet another sign of structural profitability challenges in the sector. Lastly, this crisis is also prompting an increase in risks that were already manifest before the crisis, such as competition from technology firms, the reliance on third-party IT services and, of course, cyber risks. What economic policy response is needed to address these risks? First, the improved economic outlook, underpinned by the encouraging progress of the health situation, has reduced the likelihood of the severest scenarios in terms of economic growth and financial stability. Nevertheless, the recovery remains highly dependent on the monetary and fiscal support measures. Monetary policy must continue to guarantee favourable financial conditions for all economic agents and, for now, the fiscal measures need to remain focused on the sectors and population groups hit hardest by the crisis. In parallel, the structural adjustments stemming from the pandemic must be smoothed, and efforts should concentrate on tackling our economy's structural challenges, many of which pre-date this crisis. The timely design of a fiscal consolidation programme, to be gradually  10  In 2008, there was one branch per 1,000 inhabitants in Spain, compared with 0.61 in France, 0.58 in Italy and 0.48 in Germany. By contrast, in 2020, the number of branches in Spain had fallen to 0.47, below the 0.48 in France, but still far from the 0.39 in Italy and 0.29 in Germany.

NPLs to the resident private sector continued to decrease, albeit to a lesser extent than in previous years. In 2020, the stock of NPLs fell by 3.8% year-on-year (down 4% in March 2021), compared with steep declines in 2019 (-19.1%) and 2018 (-29.1%). The NPL ratio also continued to decrease, again more moderately than in recent years, to stand at 4.4% in December 2020 (the same rate as in March 2021), down 0.4 percentage points (pp) on the previous year. The public support measures for firms and households would largely explain the lower sensitivity of NPL rates to changes in activity during this crisis. These measures appear capable of absorbing a significant share of the potential impact of the crisis on banks’ solvency, thus limiting solvency risks.2  2  For instance, according to the FLESB stress tests published in the Financial Stability Report (Autumn 2020), the volume of public guarantees considered in the exercise could absorb approximately 30% of the expected credit loss, improving the CET1 capital ratio by between 1.5 pp and 1.75 pp in the period 2020-2022 under the different scenarios envisaged. It should also be noted that the exercise identified a wide confidence interval around these figures. 4  Third, the impact of the pandemic has also squeezed the Spanish banking sector’s profitability. In 2020, the consolidated net profit of Spanish deposit institutions as a whole was negative (around € billion). This translated into a return on assets (ROA) of -0.21% and a return on equity (ROE) of -3.1%.
Housing prices and the households’ debts as a percentage of their disposable incomes rose substantially in Sweden from the mid-1990s until the start of the financial crisis. As can be seen in Figure 8, real housing prices also increased dramatically in the other Nordic countries in this period. However, the situation has been different in recent years. The rate of growth in loans to households has fallen significantly and the debt ratio has therefore levelled out, although at an historically high level (see Figure 9). Increases in housing prices have also been much more subdued in recent years. As in Finland, real housing prices seem to  10  In the United States, the central bank has added liquidity to the markets by purchasing bonds. The central banks in the United Kingdom and Japan have also launched extensive asset-purchase programmes. The ECB has offered loans to European banks in the form of three-year LTRO loans (Long-term Refinancing Operations). The ECB has also announced a new support programme, Outright Monetary Transactions (OMT) which enables unlimited purchases of government bonds in countries that apply for emergency loans and thus accept the conditions for such loans. 11  In the Monetary Policy Report published in July 2012, the Riksbank’s assessment was that the long-run sustainable unemployment rate is in the interval 5–7.5 per cent. The mid-point of the estimated interval is thus 6.25 per cent. There are also other estimates of the long-run sustainable unemployment rate.

So, the key to success for CDI clearly lies beyond technology. We need to find the right commercial incentive for all to benefit and create the network effect. 30. Similarly, for the mBridge project, technical interoperability is key but relatively straight forward. The platform now has the flexibility to allow central banks to easily connect through CBDCs or traditional payment systems. But that won’t attract more jurisdictions to join by itself. To do that, the platform needs to account for policy and business challenges. How to build-in different regulatory requirements like anti-money laundering, how to ensure sufficient on-chain foreign exchange liquidity, or how to develop a shared legal framework are all challenging but necessary tasks. The project team will focus on these issues, which are well beyond technology, in taking the project to its next stage. Closing 31. The HKMA began its fintech journey six years ago. We have come a long way, reached some important milestones, kept pace with our peers, and are now pressing on into uncharted territory. But like everyone else, we are still exploring, experimenting and learning. And as we continue our journey, we will stay radically open-minded, learn from our failures and keep trying, and go well beyond technology to achieve network effects. 32. As I said at the beginning, Hong Kong will continue on the road of fintech adoption. Many exciting developments are taking place, and you are bound to see interesting sights and meet interesting people on the way.
Moving forward, we all have a role to play to ensure that boards of financial institutions in Malaysia continue to be served by high-calibre directors who will guide our institutions on a path of sustainable growth in the service of the economy. BIS central bankers’ speeches  3

In December last year we held a Stakeholders Workshop at which the drafts of the Revised Companies Act, the Securities Bill, the Bankruptcy Bill and the Collective Investment Schemes Bill were tabled for discussion by all stakeholders. These pieces of legislation are now being finalized and would be presented to the next Parliament for enactment. The Other Financial Services Amendment Act 2007 will serve to provide the legal basis for the operation of the stock exchange until the enactment of these legislations. We have also invested in training of personnel to guarantee the professional conduct of operations, and in this regard, we have collaborated with relevant institutions and professional bodies to make sure that the codes and practices underlying the operations of the market meet established standards. Today, as we inaugurate the Sierra Leone Stock Exchange we note with pride and confidence that we have achieved a significant milestone in the development of our financial system. In the coming weeks we will commence actual operations. In this regard, I wish to solicit the support and cooperation of all institutions and the general public to work towards the success of this venture. In closing, I wish to thank all those who have helped us in getting to where we are today, and seek your continued assistance as we traverse this very difficult terrain.