samchain/econo-pairs-v1 huggingface dataset:
The Kingdom achieved a surplus in its budget amounting to 5.2 percent of GDP, and recorded a surplus in the balance of payments for the twelfth year in a row which stood at Rls 250.3 billion. The inflation rate rose slightly from 5.1 percent in 2009 to 5.3 percent in 2010, and stood at 5.2 percent in October 2011. It is noteworthy that the inflation in recent years resulted from a rise in food prices and rents. The pace of growth in the national economy is expected to accelerate during the current year. Several factors contributed to such growth in GDP, including increased government spending to unprecedented levels, a large part of which was devoted to various development projects, and an increase in domestic banks’ finance to both the public and private sectors. Custodian of the Two Holy Mosques, In continuation of your care to fulfill the needs of the citizens and provide the requirements of a decent life, you issued a number of royal decrees, which will, Allah willing, contribute to enhancement of the citizens’ standard of living. You ordered the establishment of the Ministry of Housing and approved the building of 500,000 housing units in all regions of the Kingdom over the coming five years with allocations of Rls 250 billion. The limit of housing loans extended by the Real Estate Development Fund was increased from Rls 300,000 to Rls 500,000 which will hopefully provide more houses for citizens and constrain the inflationary pressures stemming from the increase in house rents.

Inflation and Monetary Policy Outlook  Now, I would like to present our inflation and output gap forecasts based on the outlook I have described so far. When forming our forecasts, we assumed that the tight monetary policy stance will be sustained for a while; and consequently, annualized loan growth rate will hover around 15 percent and the Turkish lira will display a mild appreciation trend. Accordingly, inflation is expected to be, with 70 percent probability, between 5.1 and 7.9 percent with a mid-point of 6.5 percent at the end of 2012, and between 3.3 and 6.9 percent with a mid-point of 5.1 percent at the end of 2013. We expect inflation to stabilize around 5 percent in the medium term (Chart 17). Chart 17. Inflation and Output Gap Forecasts  * Shaded region indicates the 70 percent confidence interval for the forecast. Overall, although demand and cost conditions have not changed notably since the publication of the October Report, we revised our inflation forecasts for end-2012 upwards due to higher initial point (the initial point referring to the latest inflation data before the forecast period) resulting from higher-than-expected inflation during the past three months. As elaborated on in the Report as well, cumulative increases in the exchange rate and commodity prices coupled with soaring unprocessed food prices and the developments in administered prices pushed inflation to high levels in 2011. We estimate that inflation will remain flat in the first quarter and exhibit a gradual downtrend starting from the second quarter (Chart 17).
Charles Bean: The future of monetary policy Speech by Mr Charles Bean, Deputy Governor for Monetary Policy of the Bank of England, at the London School of Economics, London, 20 May 2014. *  *  *  I left the London School of Economics to become the Bank of England’s Chief Economist and a member of its fledgling Monetary Policy Committee (MPC) almost 14 years ago. The Bank had not long been given the responsibility for determining interest rates but had at the same time relinquished the responsibility for banking supervision. As I approach the end of my tenure, the Bank looks rather different: banking supervision has returned; and a new policy committee – the Financial Policy Committee – has been charged with preserving the stability of the financial system. As I look back, I think it is fair to say that it has been a pretty extraordinary – indeed unique – period to be involved in economic policy. My first seven years were years of plenty: growth was steady; unemployment was low; and inflation never strayed far from target (Chart 1). From time to time, the MPC nudged Bank Rate up or down a quarter point, and the economy obediently stayed on course. To economists, this period of unusual macroeconomic tranquillity is known as the Great Moderation. But the second seven years were years of famine, as the Great Moderation turned into a Great Tribulation: the worst financial crisis for a century; the most prolonged downturn on record; and inflation rising above 5%.

This is an opportunity for us to discuss the success of Bulgaria’s monetary policy regime in the broader context of the lessons from the current crisis. The speakers and discussants from the BNB today and tomorrow will share the knowledge we have acquired, based on our rich institutional experience. The experience of the Bulgarian central bank is unique. We are one of very few central banks in the world which have both practiced “conventional” monetary policy (involving setting of policy rates and conducting open market operations) and then operated a currency board after that. We have had a track record, during the last two decades, of monetary policy under two remarkably contrasting regimes. Thus our legacy is very different from that of the other similar monetary policy regimes in Europe (such as Estonia, Lithuania, or Bosnia and Herzegovina), where the currency boards were adopted by newly-established central banks in newly-independent states as a means of bringing confidence in a new national currency, promoting political emancipation and national identity. That was not our case, however. The currency board arrangements were introduced in Bulgaria exactly 15 years ago with the very same motivation that stays behind the current reform agenda in the euro area. We did it in order to achieve a much more efficient macroeconomic management and to bring in credibility in the whole policymaking process. Furthermore, the case of Bulgaria demonstrates the importance of maintaining wide consensus among politicians and the society at large, on the key principles of economic policy.
But French and European savers are more attached to security – or capital protection – than to liquidity. Therefore professionals should offer them savings products that are less liquid, with some long-term capital guarantee, and that offer the best equity performance over time. A crucial point is to avoid any tax distortions that might penalise these products more than liquid and risk-free investments. Low interest rates are not the disease, but the symptom of an imbalance between savings and investment; and low interest rates are probably an opportunity to speed up the cure towards productive investment. –  At the European level, we need to build an ambitious “Financing and Investment Union” (FIU) bringing together existing initiatives – namely the Juncker plan, the Capital Markets Union and the banking union – which currently work in isolation and therefore do not bring sufficient results. We definitely need to put the pieces of the puzzle together to create a multiplier effect towards private risk-sharing in Europe: with more equity financing and more cross-border flows. The second way forward for raising investment and growth in Europe is to rapidly stabilise the regulatory environment for banks, eight years after the financial crisis. However, in finalising the Basel III reforms we need to avoid two pitfalls. First, as has been stressed by  2  BIS central bankers’ speeches  the GHOS and the G20, the completion of reforms should not result in a “significant increase in overall capital requirements”.

At the same time we intend to keep a higher minimum level of capital adequacy ratio than the European standards, in order to provide for some cushion for other forms of risk like operational risk; Third, we try to gain as much as possible out of the experience and knowledge of other countries in the region, which are in a more advanced stage in their efforts of adopting Basel II requirements either partly or fully. We have also the privilege of being close to the euro area member countries, like Italy and Greece, with their banks playing an important role in our financial system. This gives us the possibility to benefit out of expertise of the supervisory authorities of these countries, in the process of adopting new requirements; Fourth, we have expanded our cooperation with other “peer” countries in the region, as the variety of problems found in our countries is very similar and the experience sharing in this respect, is very practical; Fifth, we are trying to promote an environment where issues of Basel II are being discussed in a professional level. We are not focusing only on directly involved parties (including government, other supervisory authorities of the financial market) but also on relevant clients of the banking and the financial sector. Concluding, I would like to stress that Basel II represents a logical and appropriate successor to Basel I. It embeds recent and past lessons and gives excellent directions to financial system and supervision authorities how to move ahead.
Moreover, the ongoing rise in indebtedness levels and the prevalence of debt incurred at variable interest rates entails a greater sensitivity of the Spanish economy to monetary policy decisions, against a background in which the present generosity of monetary conditions may be expected to move to a more normal footing. The influence of interest  6  BIS Review 60/2006  rates on expenditure is undoubtedly sharper in the case of relatively more indebted households, which are in the lower strata of the income distribution. Along these same lines, the strong concentration of household wealth in property and the relative weight of productive activities related to the residential sector are resulting in a greater exposure of the economy as a whole to the changes in property-market activity and prices. Regarding the latter, 2005 appears to have marked the start of a slowdown in house prices, raising (all the more so the more firmly the deceleration becomes entrenched) the likelihood of the current overvaluation of housing being progressively reabsorbed, as in previous booms. Let me remind you, however, that some element of risk is always present in all scenarios involving the absorption of a phase of overvaluation. This is a consideration that all agents should bear in mind when deciding where to place their investments.

Managing a crisis also requires laws and regulations that enable a problem institution to be closed down quickly or managed in some other way. Sometimes it is necessary to take measures very quickly, perhaps even the same day. It is not possible to wait for the usual court process to be completed. To avoid this leading to any form of malpractice, the injured party should have the opportunity to obtain redress and damages afterwards. We had this kind of a law in Sweden during our financial crisis. Another question is when a court should be allowed to stop important authority decisions intended to deal with acute bank problems, such as closing a problem bank. When a bank needs to be closed, a difficult balance arises, between the owners' interests and the savers' interest, which are both safeguarded in law. One very current example of this dilemma in Sweden is the case of Custodia. Both the country administrative court and Finansinspektionen (the Swedish financial supervisory  2  BIS Review 83/2006  authority) have made their assessments on the basis of what they should take into account, that is to say the customers' interests and the company and owners' interests respectively. However, I feel that it is very unsatisfactory that we in Sweden do not have a clear legal framework that can manage this type of situation and I assume that these difficulties will quickly be repaired. Crisis prevention also includes creating sufficiently strong public authorities.
The International Monetary Fund or the IMF has estimated the amount of money laundered worldwide to be in the region of 2% to 5% of global GDP annually or equivalent to USD800 billion to USD2 trillion a year. Indeed, the financial community now regards financial crime such as fraud, money laundering and terrorist financing, including cyber terrorism and crime, as one of the top operational risks that they face. While the direct cost of financial crimes to individual financial institutions may be substantial, it pales in comparison to the damage to the overall financial system that can arise from the failure to implement adequate measures to effectively combat financial crimes, in particular those relating to money laundering and terrorist financing. Such costs include reputational damage to the institution and country, loss of confidence of key stakeholders such as  BIS central bankers’ speeches  1  depositors, investors and the public at large and perhaps more damaging, the loss of or restricted access to international financial system, including correspondent banking relationships. With the increasing trend by supranational bodies to publicly name jurisdictions that are seen to be uncooperative, and to call on their respective members and the broader international community to implement appropriate countermeasures in dealing with institutions and entities from these jurisdictions, the implications, both financially and socially, can be devastating to the countries concerned.

I hope you will exploit this platform to disseminate as much information on Islamic banking and finance as possible so as to provide an opportunity for the public to learn more on the products, services and benefits of Islamic banking and finance. This year's Islamic financial expo presents a different appeal altogether with various differentiated activities and events organised for the diversified target groups and consumers. I note that various activities have been arranged for the next five days including Islamic banking and finance exposition, the annual Islamic Finance Forum, colloquium on Islamic finance, convention on takaful and Islamic unit trust advisors and Muzakarah for Shariah advisors. This is indeed an excellent opportunity for exchanging ideas as well as providing relevant information to the public on Islamic finance. It is also timely and augurs well with the recent announcement of the initiatives to position Malaysia as the international Islamic financial centre. The Islamic financial industry in Malaysia has experienced rapid transformations particularly in the past ten years. The Malaysian Islamic banking system registered strong performance with higher profitability and positive trends in all key indicators. Profitability surpassed the RM1 billion mark for the first time in 2005, and this year the industry will again register good profit as for the first half of 2006, the amount of profit generated was already RM800 million. The total assets of Islamic banking currently stands at RM122 billion. The performance of the Malaysian Islamic financial market in particular the capital market has been encouraging.
However, first and foremost I would like to point out that monetary policy aimed at stabilising the inflation rate should basically reduce the risk of over-valued asset prices leading to an exaggerated real demand. Fluctuations in the level of resource utilisation and in the output gap are traditionally assumed to be reflected in the inflation rate. If inflated asset prices stimulate demand in the economy, without a corresponding increase in the potential growth rate, inflation will rise. If the central bank anticipates this, monetary policy will normally be tightened to ensure that demand is compatible with long-term sustainable growth. And as long as demand in the economy increases at a rate compatible with long-term growth, there is less risk of exaggerated indebtedness. Inflation targeting should thus, at least in theory, reduce the risk of extensive financial imbalances accumulating. However, even with an otherwise successful inflation target policy, real and financial imbalances created by exaggerated asset prices can build up. If there are exaggerated expectations regarding growth in productivity and profits in a particular country, this can lead to a strong inflow of capital and strengthening of the currency. The increase in real demand, which is caused by exaggerated increases in asset prices, can thus be partly met by increased imports, while the currency strengthens and domestic inflationary pressure is reduced.

Eva Srejber: Inflation targeting and bubbles Speech by Ms Eva Srejber, Second Deputy Governor of Sveriges Riksbank, at the Adam Smith seminars, Paris, 9 July 2002. *  *  *  Since the mid-1990s, inflation has stabilised at very low levels in the industrial nations. From an average inflation rate of 6 per cent during the period 1975 to 1994, the rate of price increase has been slightly below 2 per cent over the past 6 years. This entails a return to the same low inflation rate as prior to 1970. Inflation has also been reduced considerably in most other countries in, for instance, Asia and Latin America. There are many factors that have contributed to this. Firstly, price stability has become an explicit objective for monetary policy in many countries. An increasing number of central banks are orienting their monetary policy towards a fixed inflation target. This includes the Riksbank, which, after the fixed exchange rate was abandoned in November 1992, established an inflation target of 2 per cent with a deviation interval of plus/minus one percentage point. The orientation of monetary policy has in many countries been supported by a fiscal policy aimed at budget consolidation. Independence for the central banks in Europe, convergence criteria for EMU membership, the stability pact in Europe and the ban on financing budget deficits through printing new banknotes are all examples of measures that have helped increase confidence in the price stability target. Increased competition in the wake of globalisation has probably also subdued inflation temporarily.
There also seems to be agreement for the extension of regulatory tools to address pro-cyclicality in the financial system through the creation of counter-cyclical capital buffers, dynamic loan-loss provisioning and greater alignment of incentives with long-term goals. This consensus reflects the objective of avoiding having incentives that would encourage the material build-up of leverage and the excessive appetite for risk. Other measures under consideration include the implementation of non-risk-based leverage limits to contain the build-up of leverage in the banking sector and the strengthening of the supervisory framework and the arrangements for dealing with oversight on crossborder financial groups and for resolution. Implications for Islamic finance Islamic finance does not exist in isolation and as it becomes an increasingly important component of the global financial system, it will inevitably be impacted by the changing global landscape of financial regulation. This is particularly the case as its growth gains momentum both in terms of number of services providers and in terms of business volume and as its internationalisation process continues. The global call for improved regulation and increased oversight will thus intensify the efforts that have already been undertaken to strengthen the financial regulation for Islamic finance.

Ladies and gentlemen, A sustained process of excessive financial deregulation and over reliance on market discipline particularly in advanced economies which led to a prolonged cycle of optimism and  BIS Review 64/2010  3  risk taking has been widely cited as part of the root cause of the recent global financial crisis. Indeed, the pre-crisis era was a period of exuberance in financial innovation and rapid development in the conventional financial landscape. Although it was argued that financial deregulation encourages innovation which in turn result in the more efficient allocation of resources, the recent crisis has shown that there is a need to balance between market discipline and regulatory oversight. Whilst there is general support for the reform measures, there is also concern on the dangers of over-reaction by policymakers that could undermine the role of financial intermediation, and adversely affect the ultimate objective of economic growth and development. The concern is specifically on the unintended consequences of the regulatory reform. Financial stability is not an end in itself; it is a means towards achieving the ultimate goal of sustainable growth and shared prosperity. This presents the challenge for policymakers in finding the appropriate balance between preserving the resilience of the financial system versus maintaining the ability of the system to perform their intended function of delivering effective, efficient and innovative financing solutions to customers in the wider economy. Hence, the concern is that that the regulatory reforms would increase the cost of financial intermediation.
But there have also been increasing calls for a single trusted ‘golden source’ from which bespoke rates can be calculated, to complement or cross-check those quoted by commercial providers. Similar steps are being taken in other jurisdictions, including the US and Switzerland for dollar and Swiss Franc rates respectively.14  The Bank is therefore announcing today our intention to publish a SONIA-linked index from July this year. In addition to the overnight SONIA rate we already publish, this index will allow market participants to calculate a wide range of compounded SONIA rates for longer-than-overnight products by simply using the start and end-date of their product (Figure 3). This approach brings three main benefits for market participants;  -  Ease – the index will make it easier to calculate compounded SONIA interest rates, requiring only two data points;  -  Reduction of uncertainty – the index will use a consistent and standard set of conventions, reducing the scope for confusion over different calculation methodologies, and making reconciliation simpler; and  -  Flexibility – the index will be publicly available and allow firms and end-users to calculate the compounded rate for products of any combination of start and end dates and any maturity. We hope that, in time, this tool will complement others already available, helping to build further momentum for LIBOR transition in sterling cash markets – supporting both end-users and loan and infrastructure providers. But these firms should not wait for the index before undertaking their own broader preparations.

Turbo-charging sterling LIBOR transition: why 2020 is the year for action – and what the Bank of England is doing to help Speech given by Andrew Hauser, Executive Director, Markets  International Swaps and Derivatives Association/SIFMA Asset Management Group Benchmark Strategies Forum, London  Wednesday 26 February 2020  I am grateful to Sarah Hall for co-writing this speech – and to Amber Evans, Alastair Hughes, Wayne Leslie, Will Parry, Rhys Phillips, Edwin Schooling Latter, Dave Ramsden and Francesca Zwolinksy for their advice and comments. 1  All speeches are available online at www.bankofengland.co.uk/news/speeches  Introduction 2020 is a critical year for LIBOR transition. Great progress was made in 2019, particularly in sterling wholesale markets – and I want to give special thanks to the part that ISDA’s support and leadership has played in that. But, with the finish line for LIBOR now clearly in view, there is still a lot of ground to cover – particularly in the cash markets. We need to see another decisive acceleration in effort in 2020 to ensure risk-free rates are adopted across the full range of sterling business, and LIBOR is left behind for good. The motor racing analogy is apt, because LIBOR transition is complex, fast-paced and – above all – a team effort. The green lights came on some time ago, and the private sector has been decisively – and rightly – leading from the front.