samchain/econo-pairs-v1 huggingface dataset:
To some extent this is a consequence of transitory factors that are judged to have no permanent effect on either inflation or the inflation process and should therefore not influence the formulation of monetary policy. These transitory factors – altered indirect taxes and subsidies as well as lower interest expenditure – are projected to lower the CPI by between 0.5 and 1 percentage point in the coming two years. But even excluding the transitory factors, it is considered that inflation will be below the target in 1999 and 2000. In the light of its assessment, last Thursday the Executive Board decided to ease the monetary stance. The future formulation of policy is something that will also be discussed in the Inflation Report, which will be published on March 25th. BIS Review 18/1999  6

Conclusion I will now place my observations on monetary policy in a broader context and formulate three key messages. But before doing so, I would like to point out that the decision to adopt an independent monetary policy is not a purely economic one. Central banks act within the framework that is laid down for them by the legislature and, ultimately, the sovereign power. The culture and history of a country play an important role in selecting the national monetary order. And now I come to my three key messages. My first message is that it is possible for small open economies bordering a large currency area to pursue an independent monetary policy. It allows the central bank to react to disruptions specific to its own country and to ensure price stability in the medium term. For example, following the onset of the financial crisis, central banks in Europe lowered their  10  The first central bank outside Europe to introduce negative interest rates was the Bank of Japan, at the end of January 2016. 8  BIS central bankers’ speeches  interest rates at different points in time and to varying degrees to cushion the effects of the demand slump. Both conventional and unconventional monetary policy measures helped to absorb the shocks of the euro crisis and the ECB’s substantial monetary policy easing from March 2014. My second message is that in times of crisis, monetary policy’s usual room for manoeuvre can be quickly exhausted, making unconventional measures necessary.
In the first three quarters of 2004, imports increased markedly compared with the same period last year. This may indicate that some of the growth in demand has resulted in an increase in imports instead of higher domestic output. Imports as a share of mainland GDP are rising. This is a result of an increase in the international division of labour, due in part to the removal of trade barriers. The rise in the share of imports must also be seen in relation to low prices for imports from many low-cost countries and the weak competitiveness of domestically-oriented industries. The deterioration in Norway’s competitiveness relative to other countries stems from high wage growth over several years since 1998. The nominal krone exchange rate measured by the trade-weighted index (TWI) is now approximately at the level prevailing in the mid-1990s, while labour costs in manufacturing have risen considerably more than among our trading partners in the same period. The business sector is still burdened with the loss in competitiveness that can be attributed to high wage increases in the period 1998-2002. The exposed sector has been scaled back. Companies that are still in operation may be in a better position to cope with the high wage level. A more efficient service sector may also have strengthened the export industry. Nevertheless, costs may have negative impact on activity and employment.

The projections in the Inflation Report are based on the assumption that the interest rate moves in line with financial market expectations. This implies that Norges Bank maintains the key interest rate at the current level in the period to summer 2005, with a gradual increase thereafter. It is the Executive Board’s assessment that the projections seem to provide a reasonable balance between the objective of increasing inflation and at the same time avoiding excessive growth in output and employment. The projections imply a sight deposit rate in the interval 1¼ - 2¼ per cent in mid-March 2005. This is conditional on economic developments that are approximately as projected in the strategy period. The interest rate should be assessed regularly on the basis of new information emerging during the strategy period that is of significant importance for the outlook for inflation and output. Particular weight must be given to factors that may delay an increase in inflation. Uncertainty as to the effects of previous monetary policy easing and the unusually low interest rate level imply, on the one hand, that we should exercise caution with regard to further interest rate reductions. On the other hand, the prospect of continued low inflation for a period ahead implies that wide deviations from projected economic developments would be required before interest rates should be increased. The prospect of continued low inflation in Norway also implies that we should lag behind other countries in setting interest rates at a more normal level.
Although in my judgement the risk of liquidity problems in the run-up to the coming year-end is small, it is of course never possible to rule out the possibility that technical hitches might lead to temporary problems. One hypothetical issue that has been discussed is what would happen if a single bank, in spite of everything, encountered technical problems in sending out its payments. The banks that were to receive these payments would then run the risk of a temporary deficit that would have to be financed by the Riksbank. If it should prove impossible in that situation to present an adequate amount of collateral, the Riksbank would be able to make use of the existing legal option of offering loans on special terms, always assuming that those affected were solvent. The situations in which this option is to be used and exactly how this is to occur is considered on a case to case basis. The Riksbank always maintains a high level of preparedness for taking quick decisions about loans of this kind. The financial sector was early in paying attention to the millennium problems. Representatives of the financial sector meet in varying constellations for discussions and to make sure that adequate measures  2  Sveriges Riksbank: Finansmarknadsstatistik No. 6 (Sveriges Riksbank: Financial Market Statistics No. 6). 3  BIS Review 97/1999  have been taken to avoid problems.

A further means of enhancing confidence and reducing vulnerability is to establish contingency plans, i.e. measures that will be resorted to should problems still arise in spite of all preparations. Such plans are not something that should be unique to the change of millennium; they should always exist in organisations in the financial sector. Many of the measures that have been taken in preparation for the transition to the year 2000 have focused on questions related to confidence. A high degree of confidence in financial markets is important if the markets are to function efficiently. For this reason, anxiety that the functioning of the market may be impaired or a lack of confidence in the payment systems, are enough in themselves to constitute a problem. 1  BIS Review 97/1999  Lately, comments have frequently centred around possible liquidity problems. However, the exact significance invested in the word liquidity is often unclear, as is what, fundamentally, could lead to problems. The word liquidity means “the capacity to quickly obtain funds for the settlement of debts”.1 In practice, the word liquidity is used to express a variety of phenomena. In my opinion, therefore, it may be appropriate to take a closer look at the concept of liquidity and to clarify the role played by the Riksbank in managing liquidity. The comment that liquidity in the market is poor often describes a situation in which major price changes occur even when turnover is low. To use market jargon, the market is said to be thin.
7 This is in part a result of the effects of the crisis on investment and, via hysteresis, structural unemployment. But it also reflects weak underlying trends in productivity growth and labour supply. Consequently, while some of the  3  Bartelsman, E., F. di Mauro and E. Dorrucci (2015),“Eurozone rebalancing: Are we on the right track for growth? Insights from the CompNet micro-based data.” www.voxeu.org. 4  Draghi, M. “Stability and Prosperity in Monetary Union.” Speech at the University of Helsinki, 27 November 2014. See also keynote address at the Süddeutsche Zeitung Führungstreffen Wirtschaft, November 2013. 5  Banco de España (2013), “Variation in the cyclical sensitivity of Spanish inflation: an initial approximation.” Economic Bulletin, July–August 2013. 6  Riggi, M., and F. Venditti (2014), “Surprise! Euro area inflation has fallen.” Banca d’Italia Occasional Papers No. 237, September 2014. 7  European Commission, Winter 2015 projections; IMF, April 2015 WEO; OECD, November 2014 Economic Outlook. BIS central bankers’ speeches  3  effects of the crisis on investment and employment are expected to unwind, potential growth is projected to remain well below pre-crisis growth rates. This is problematic for at least three reasons. First, it would mean that the output gap would close at a notably lower level of output, at which point monetary policy would have to return to a more neutral stance (Chart 4). A significant share of the economic losses suffered across countries would therefore become permanent. Structural unemployment would stay around 10%.

Many papers have been written recently that show what may be the consequences of the scenario in which the financial markets - in view of no adequate measures undertaken by economic decision-makers - initiate adjustment processes by themselves 16 . If the financial markets start pricing in higher risk premium for American debt securities, the outflow of capital from this market - or even decreased capital inflows - may lead to a fall in bond prices, i.e. to a sharp increase in long-term interest rates, a slowdown on the property market, depreciation of the dollar and, consequently, stagnation or even recession, which may be observed globally. In order to mitigate the probability of such a scenario, structural reforms should be implemented in many countries. The USA should substantially reduce its budget deficit and - via a reform of the pension system - increase the household savings rate. In the EU and Japan a series of structural reforms should be accelerated to raise the flexibility and competitiveness of the labour and product markets . In the Asian countries, and first of all in China, the exchange rate regime needs to be made more flexible, which should be preceded by reforms that would strengthen the financial system, also via a greater openness to foreign capital inflows. At present, it is difficult to assess the likelihood of the scenario involving a serious slowdown in the global growth; nevertheless, implementation of necessary reforms is proceeding slowly.
What I’d like to offer in my remarks today are some steps I see as necessary for institutions navigating in this new environment to begin to address the concerns I’ve outlined above. And, I’ll close with a couple of issues that remain on my “insomnia” list that will continue to warrant increased efforts in the coming year. What will it take for firms to navigate in this new environment? Addressing the weaknesses I’d like to start first with a fundamental observation: we need to focus first on fixing what was so obviously broken. The new sets of rules and regulations, whether global or local, were designed to address the very weaknesses that led to bad outcomes during the financial crisis: low levels and quality of capital; insufficient liquidity; fundamental weaknesses in a range of risk management practices; poor management information and reporting systems; complex structures and systems that couldn’t be quickly taken apart; and the list goes on. We know we need a more resilient system that is able to withstand a wider range of stresses, as well as provide buffers when firms do falter. And, importantly, we need to do this to restore confidence in the financial system. The new rules and regulations are intended to address the known weaknesses, and before we can talk about whether the global business model is viable or how to operate more efficiently within the constraints imposed, the basic underpinnings of a strong and resilient financial system need to be in place and functioning.

Our economies and our societies have suffered heavily – indeed, on all available forecasts, this year will see the biggest declines in GDP recorded in peacetime – and we will have to endure a period of painful reconstruction for which sound knowledge and also good judgment will be essential. 1/1  BIS central bankers' speeches
It should therefore be possible to define and build a framework around the following principles: countries should self insure against idiosyncratic risk by holding a sufficient amount of reserves. Protection against systemic risk would come from a multilateral mechanism for international liquidity provision. Of course, the distinction between idiosyncratic and systemic risk may be difficult and involves a broad degree of judgment. But two basic rules should be guiding future work on a multilateral safety net: (1) conditions for access should be specified ex ante; and (2) those conditions should be fully delinked from the situation of individual economies. Rather, they should depend on the state of the global economy and international financial markets. From the point of view of an individual country, access should be fully unconditional, once global conditions are met. A considerable amount of work is currently devoted to devise instruments of contingent capital for financial institutions in times of crisis. The same intellectual framework can be extended to liquidity. What is needed is contingent liquidity i.e. liquidity available to nations in times of aggregate shocks to the international financial system. This raises two questions: where would such liquidity come from? How could it be mobilized? As to the source, a possibility would be to create a process of periodic general allocation of SDRs, according to a predetermined schedule .Those SDRs, however, would not be  BIS Review 76/2010  9  immediately available for use by their beneficiaries.

But I have every confidence that collectively, the combined effort of AICB and ABS together with the industry would transform the landscape of the Malaysian banking workforce in the coming years into one which is highly skilled and highly qualified. This brings me to the second strategy toward sustaining the competitiveness of talents for the banking sector, which relates to the imperative to increase state of readiness for graduates at entry-level into employability, to bridge gaps and allow for a smooth transfer of academic skills to the work environment. What we should strive towards is a more structured and coordinated approach to training that reduces time to competence for graduates. We need to consider a framework for structured industry-wide internship or apprenticeship programs for new entrants to the industry. The structured internship program for the accounting fraternity can perhaps be a good reference point for the banking sector to consider and emulate. ABS can lead the pack in this initiative by playing a bigger role in the review of FSTEP by making it more relevant and forward working to industry requirements. To achieve these objectives we need to collaborate and work collectively as an industry to work more closely and in partnership with ABS and AICB. Clearly, there is scope for stronger collaboration in workforce development that delivers high value proposition between the banking institutions and the industry’s talent development entities.
This mechanism has allowed banks to transfer the risk of the financing they originate to the market. Until the turbulence emerged, the originate-to-distribute model had generally been understood to be a very effective instrument of risk management: the banks using the model had an additional mechanism to decide on the degree of risk exposure on their balance sheets, while these risks were transferred within the financial system to those agents most prepared to assume them. However, the present situation seems to show that the risks have not ended up with those investors most prepared to assume them, but with those who least understood them. What problems have led this business model to the current difficulties? Firstly, and insofar as the banks that granted the financing rapidly packaged the loans and placed them on the market, very powerful incentives arose to lower credit standards in the extension of loans, so that the selection of borrowers was not made following sound banking risk management practices. What is more, perverse incentives also came into play in the monitoring of borrowers, since the originators disassociated themselves from the financing. Furthermore, once the problems surfaced in the form of an increase in defaults, the possibilities of resolving these problems were also seen to be very limited. The number of agents intervening in the process is high and their interests do not always fully coincide. In other words, compounding the incentive-related problems that emerge when the economic situation is favourable are conflicts of interests once the situation has turned adverse.

The pertinent question to ask, therefore, is whether or not prudential regulation amplifies this natural behaviour by financial market participants. Before analysing the elements of procyclicality that Basel II and international accounting standards may contain, it should be stressed that this set of rules includes numerous positive  4  BIS Review 62/2008  elements. Basel II will entail, and is in fact entailing, notable progress in the management of the risks credit institutions face. Had Basel II been in force some years back, many of the dysfunctions currently lying behind the turbulence would not have taken place. Moreover, international accounting standards, and in particular the financial reporting standards adopted in 2005 by the European Union, contribute to the common goal of a single financial market, since it appears reasonable that companies operating in a single area should be subject to the same accounting rules. Returning to procyclicality, I must remind you that this was a very significant debate during the period Basel II was being prepared. Insofar as capital requirements are more sensitive to risk, it is reasonable to believe that procyclicality is greater, requiring less capital when things go well and more capital when they go badly. The Basel Committee on Banking Supervision was mindful of this and that is why the new regulatory framework for capital includes elements that mitigate it, both under Pillar 1 and under Pillar 2.
The table taken from his seminal paper On Computable Numbers in the foreground is a succinct representation of a Turing Machine, and the ticker tape records Turing’s birth date in binary code. In the background are images of the ACE pilot machine and a section from the technical drawings of the Bombe. The portrait is by Elliott and Fry, and the quote is from an interview published in The Times, dated 11 June 1949. ******** The characters on our banknotes celebrate those who have advanced British thought, spurred innovation, shown exceptional leadership, shaped this diverse society and forged our common values. Alan Turing will join Winston Churchill on the £ note and Jane Austen on the £ and JMW Turner who will make his appearance on the new £ next year. Although we look to history when we chose a new character, Turing’s work inspires us to look to the future and imagine what is still to come as a result of his genius. If anyone can see the future, it’s the next speaker. It is my pleasure to welcome Demis Hassabis – artificial intelligence researcher, neuroscientist, video game designer, chess champion, co-founder of DeepMind and one of the 225,000 who submitted a recommendation to this process – to celebrate Turing’s past contributions to science and venture where they might take us tomorrow. 6  All speeches are available online at www.bankofengland.co.uk/news/speeches  6

2/3  BIS central bankers' speeches  To conclude, Islamic financial institutions have developed into matured institutions that are now offering a wide range of financial solutions to meet the varied needs of customers. Therefore, halal businesses should seize these opportunities to better position themselves and embrace sustainability, as well as digitalisation that aim to provide stronger platforms to rebound as the economy recovers. In closing, I would like to share with you an inspiring verse from the Quran, that serves as the foundation to the key points I have intended to raise earlier. In Surah Al-Baqarah verse 195, Allah s.w.t mentioned, “And do good, indeed Allah loves the doers of good”. So, let us embrace this message together and put more effort in propagating good, particularly in the way we conduct businesses, by not just being halal, but also beneficial to the environment and society at large in line with the commandment of Allah s.w.t. Let us begin this today, here at the World Halal Business Conference 2021. Thank you and I wish everyone a pleasant and productive conference. 1 Source: Dinar Standard, The State of Global Islamic Economy 2020/2021 2 Halal food, Islamic finance, Muslim-friendly travel, pharma and cosmetics 3 Source: HDC HIMP 2030 4 BNM internal survey 5 Source: HDC Vibes issue 06/2021  3/3  BIS central bankers' speeches