samchain/econo-pairs-v1 huggingface dataset:
It has been acknowledged that at least part of the deficit may be structural rather than cyclical in nature. Although official projections suggest that the combination of cyclical recovery and disciplined containment of government spending should restore fiscal balance in due course, scepticism is understandable; this is an extraordinarily difficult field for forecasters, since the balance is the difference between two very large numbers, each comprised of many varied components. The air of uncertainty gives rise to rumours – of sweeping expenditure cuts, of asset sales, of new taxes, of higher tax rates or whatever – and to fears that Hong Kong may not be able to preserve its distinctive edge as a place with an uncomplicated tax system and low rates of tax. Concerns which arise under any of the above headings may find expression through the financial markets. Conclusions What can one conclude from all of this? •  First, a number of reasons have been enumerated as to why fiscal deficits may be a worry, both for economies generally and for Hong Kong in particular. There can be no doubt that Hong Kong's fiscal position is a matter for concern, but monetary factors should not necessarily be paramount to that concern. •  Secondly, and in the same broad context, one should beware of simplistic assertions or hypotheses about the monetary implications or, more specifically, the exchange rate implications of fiscal deficits.

As shown by mobility data and business impact surveys, the number of visitors of retail outlets dropped by 75%, with 45% of all companies forced to suspend business or shutdown altogether, and many more to follow suit most probably in the future. Meanwhile, 44% of landlords also reduced rent as a result of the overall situation, while 64% of those polled reported sentiments of fear, anxiety, and uncertainty. In general, forecasts suggest a drop in private sector revenue as high as 42%, causing cashflow and liquidity difficulties for corporate bodies. This could cause an increase in default rates, and companies failing to pay would trigger high loan-related losses in the banking sector. Companies are expected to need a total of KD 2.4-3 billion to cover their working capital requirements (such as salaries and rent payments). It is also expected that the prolonged lockdown would bring about layoffs and increase unemployment in the private sector. Amongst all nationals employed in the private sector, 86% of them (62,000 Kuwaitis) work in economic sectors negatively impacted by the crisis. Furthermore, 79% of non-nationals employed by the private sector (1.3 million workers) also work in affected sectors. Closing these companies would disrupt supply chains and cause shortages in both the supply of basic goods and services. The drop in spending and the prevalent uncertainty will also deter future investments. Any failure to take swift and unwavering action in response to working capital requirements would have grave economic repercussions on companies, particularly on small and medium enterprises (SMEs).
The need for central banks to have a broad range of instruments, including macroprudential measures, to achieve financial stability policy objectives is now generally accepted. Focus has also been on the efficacy of different policy instruments that are needed to preserve financial stability, the structure and design of decision making frameworks and the accountabilities in regard to financial stability. For Asia, these considerations have been very much a part of the evolution of financial stability frameworks in the region in this recent decade, in particular following the Asian financial crisis. By virtue of being also responsible for bank supervision, the majority of Asian central banks have a clear mandate for financial stability, whether implied or explicit. In the case of Malaysia, this has supported the close coordination of the macro and micro surveillance functions, and more comprehensive assessments and analyses of the interactions between monetary and financial stability policies. Many central banks in the region also have considerable experience in implementing macroprudential measures, such as lending concentrations, loan-to-value limits and some form of “dynamic” reserving or provisioning policies. The intensification of regional monetary and financial cooperation among central banks in the Asian region has also served to strengthen regional surveillance and crisis management arrangements, as well as in the supervision of financial institutions with cross-border operations in the region. As Asia rises and expectations increase, the two billion Asians now at the margins of the consumption economy will radically transform global demand and supply for limited  2  BIS central bankers’ speeches  resources.

Rigid parameters, imposed by multilateral agencies and sometimes by rating agencies and the market also contribute towards reinforcing these conventions. Current and future conditions are likely to be highly complex and varying and therefore not lending itself to rigid rules. In an environment that will continue to remain challenging for some time, this Conference provides an important opportunity to discuss a wide range of issues from Asia’s perspective, thereby contributing to the international discussions and understanding of the issues and their business and policy implications. Asia’s experience will also provide additional insights in contributing towards the solutions for building a more resilient international financial system. I wish you an engaging and productive discussion. BIS central bankers’ speeches  3
We had not established a sufficiently clear institutional framework for a more discretionary monetary policy. We could not then assume that a floating krone exchange rate regime and the exercise of our professional judgment when setting interest rates would inspire confidence. We had to abandon the fixed exchange rate policy in 1992. An important reason was the weakness inherent in the fixed exchange rate regime in a world with free capital flows and deep financial markets.9 When the fixed exchange rate policy was formally abolished, the Norwegian economy again risked losing its nominal anchor. But the krone exchange rate showed little change to begin with and rapidly found a new range. 8  Official Norwegian Report (NOU) 1988:21: Norsk økonomi i forandring (A changing Norwegian economy). Ministry of Finance, Oslo. 9  For important academic contributions on inherent weaknesses in fixed rate systems, see Krugman, P. (1979) “A Model of Balance of Payments Crises”, Journal of Money, Credit and Banking 11, 311-325, Krugman, P. (1988) “Exchange rate instability”. MIT Press, Cambridge, MA and Obstfeld, M. (1986) “Rational and Self-fulfilling Balance of Payments Crises”, American Economic Review 76, 72-81. For a simplified presentation of Krugman og Obstfeld’s works, see De Grauwe, P. (1996) “International Money”, Oxford University Press, Oxford. 4  BIS Review 36/2004  Norges Bank  Consumer price inflation in Norway Percentage rise on previous year.

I have no doubt that the outcome would have been a lot worse had we been complacent and relied entirely on the self-corrective behaviour of markets. I will give here just one example: forex interventions limited significantly exchange rate fluctuations, with the appreciation during the massive capital inflows and the depreciation after the crisis outbreak not exceeding 25 percent. In the absence of such interventions, the magnitude of fluctuations could have been as high as 40 to 60 percent. The foreign exchange purchases made before the crisis not only limited the unsustainable leu appreciation and the associated loss of export competitiveness, but supplied the ammunition for subsequent interventions to cushion the currency depreciation once the outbreak of the crisis changed the direction of the flows. And I believe this is the second benefit of the approach. Last, but not least, thinking outside the box allowed us to avoid incurring losses after 2006. While profitability should not be a concern for a central bank, this development proved very fortunate from the perspective of the political economy. On the one hand, it allowed the NBR to preserve its independence in relation to the government by not generating quasi-fiscal deficits in a period with an increasing fiscal imbalance. On the other hand, it helped preserve institutional credibility in relation to the banks subject to NBR supervision, which were closely monitored in terms of capital adequacy. Moreover, through our actions we wanted to avoid rewarding the speculative behaviour several commercial banks were engaged in (i.e.
Nor Shamsiah Mohd Yunus: Reshaping Malaysia's future - setting the goal for greater governance and transparency Keynote address by Ms Nor Shamsiah Mohd Yunus, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 10th International Conference on Financial Crime and Terrorism Financing "Malaysia's Future – Setting the goal for greater governance and transparency", Kuala Lumpur, 30 October 2018. * * * A very good morning to all of you. It is my pleasure to address all of you today at this very important conference. Financial crime. Terrorism financing. Corruption and money laundering. These are heavy words that carry the feelings of outrage and displeasure, amongst others. The United Nations Office of Drugs and Crime estimates that every year globally, a staggering amount of USD2.6 trillion is stolen through corruption. Yet, I suspect, in reality, figures like these are so large that many may find it hard to relate to it. To put it in perspective, the figure is around eight times larger than the Malaysian economy. Let us also take the UN Sustainable Development Goals that aims to improve the lives of the poor, improve governance and address inequality. Some estimate that it will take around USD5-7 trillion to meet all the SDGs. This represents 2-3 years’ worth of money lost to corruption. In other words, the money lost through financial crimes is a devastating opportunity cost, draining the resources that could have been used to permanently uplift the lives of billions in this world.

As such, it is important for the industry to be aware of the trade-offs that come with adoption of these technologies. In pushing the boundaries of innovation, the industry needs to understand the risks that they pose. One example is the rise of mobile banking, e-payments and virtual assets. In Malaysia, mobile banking transactions have multiplied greatly, from around 500 million transactions in 2016 to almost 1.3 trillion transactions in August this year. The ubiquity of mobile internet and increasing dependency on our smartphones is expected to increase the importance of this medium. This technology fosters financial inclusion and offers potential for greater customer engagement. One such potential is in meeting and strengthening know-your-customer requirements. By leveraging on technology, financial institutions will be able to conduct e-KYC with greater efficiency while making the customer experience more seamless. One such solution is being tested in the Bank’s FinTech sandbox. Another area of growth comes from virtual assets. Between the end of 2016 to date, market capitalisation of virtual assets have grown by an extraordinary rate of over 1000% from around USD 20 billion to around USD 200 billion. While the technologies behind virtual assets may present great potential to revolutionise the way we conduct finance, the risks associated with virtual assets is an area that deserves much scrutiny. Features that may allow anonymous or pseudonymous transactions and easier crossborder transfers of values carry money laundering and terrorism financing risks that need to be addressed.
Credit is based on real savings and savings can only earn a return if directly invested in creating activities. Finance and the real economy are closely linked. In the Islamic system, banks can neither carry highly leveraged exposures nor acquire risky financial structured products. By the way, even if the Islamic nature of their finance is not the only explanation, we can note that Islamic finance countries, compared with those of conventional finance, have been relatively less impacted by the crisis. But on the other hand, Islamic banks pose risks to the financial system that in many regards differ from those posed by conventional banks, with respect, for example, to liquidity, operational and legal risks. Indeed, Islamic banks face specific obstacles in liquidity management, as the prohibition of interest has led to the underdevelopment of funding sources. Moreover, operational risk and legal uncertainty can be amplified by the lack of product standardization and the lack of harmonization of Islamic standards, with for example possible differences between Shariah scholars' interpretations, accounting standards, and so on. In the same way, prohibition from financing specific sectors limits the kind of eligible assets for investment, which contributes to increasing the risk of concentration in potentially cyclical sectors such as real estate. This is what happened in certain Gulf countries. •  As the analysis of the principles of Islamic finance does not settle the issue of the relationship between Islamic finance and financial stability, it needs to be supplemented by an empirical analysis.

I will come back to this point later… To focus on the matter I was invited to speak about, I would like to address several issues: •  first, the links between the current overhaul of financial regulation and Islamic finance;  •  second, the role Islamic finance could play in France;  •  the third, the relationship between Islamic finance and financial stability;  •  Finally, I would like to mention the conditions Islamic banks need to meet to ensure that their establishment in France is consistent with the smooth functioning of the banking system. ♦♦♦  The current crisis has illustrated the rapid contagion effect fostered by financial globalisation. However, it is important to emphasise that financial globalisation is not in itself the cause of the crisis, which has rather revealed failures in financial regulation. Indeed, the crisis has highlighted the need to better assess and prevent risks in the financial system as a whole, in addition to simply monitoring the risks of each individual institution. It has also shown that some features of the regulatory regime have had an amplifying effect on the economic cycle instead of mitigating it. That is why the G20 has launched an ambitious agenda to reform financial regulation, covering four main areas: the strengthening of prudential standards, the redefinition of the scope of regulation, the revision of accounting standards and the strengthening of risk management.
In itself, comparing the long-term forecasts with the inflation target would have justified raising the policy rate rather than leaving it unchanged. And subsequently some people have asked: Given the probability and arguments supporting such a decision, why wait? However, the Governors referred to the more benign short-term and long-term inflation outlook since the publication of the previous forecast [in July] and that in many important respects it seemed more positive than was considered likely then. Inflation developments were more favourable than expected. Wage rises and wage drift were also lower and housing market activity more subdued than had been projected. In addition, oil prices have been on the decrease and credit growth has slowed down. In view of these developments, although in many ways they involve only short-term changes in indicators that are known to be volatile, the Governors felt there was ample reason to wait, at least for the time being. A large amount of information will of course reach the Board of Governors before December 21. If the pointers continue in this direction, there may conceivably be no need to increase further what is already undeniably a tight monetary stance. On the other hand, if nothing of particular note is reported, the analysis at hand when the current interest rate decision was made will determine the decision on December 21 and a policy rate hike could be in the offing. As far as can be seen, there is reasonable consensus on the Central Bank’s decision among the main observers in Iceland and abroad.

28 March 2019  Speech Már Guðmundsson, Governor of the Central Bank delivered at the 58th Annual Meeting of the Central Bank of Iceland, 28 March 2019  Prime Minister, other ministers, Chairman of the Economic Affairs and Trade Committee and other members of Parliament, bank directors, foreign ambassadors, other honoured guests! This is the last speech I will give at the Annual Meeting of the Central Bank of Iceland, as I will step down as Governor this August, as is provided for by law, after ten years in the position. I would therefore like to focus on matters other than current tasks relating to monetary policy, financial stability, and other Central Bank functions, but it is unavoidable to make an assessment of the most recent events. I will focus on two main areas. First of all, I would like to take a backward glance at developments in the Icelandic economy and financial system over the past ten years. In this context, I will give my assessment of how successfully the Central Bank has achieved its objectives. The published and printed versions of this speech will include selected charts that illustrate economic developments over the period. Second, I will take a look at the future and discuss several challenges in connection with the Central Bank’s tasks and objectives. Let us now cast our minds back to mid-2009. At that time, Iceland was in the midst of its severest economic contraction since World War I, a century ago.
Everything was put in question: the current economic theories; monetary and fiscal policies; micro and macroprudential policies; the whole financial regulation. Suddenly, no one was satisfied with the global financial framework. A gallop was started for its reexamining. The fear from recurrence of the crisis and its possible deepening, for almost three years has been keeping the eyes of the creators of the economic and financial policies wide open. Why did this happen to us? A lot has been written in search for the causes of the crisis, and a lot more will be examined and written. One part of the relevant experts say: (1) The so-called “great moderation” period in the GDP and inflation fluctuations was the reason, for which a wrong sense of comfort and illusion was settled, that the crisis period is behind us. Some relevant economic minds convinced us in that. Paul Krugman, in “The Return of Depression Economics” (2008) reminds us of the statement of the Nobel Prize winner Robert Lucas that “the central problem of depression-prevention has been solved, for all practical purposes” and the statement of Ben Bernanke in his famous speech named as “The Great Moderation”, where he claims more than Lucas that the modern macroeconomic policy has solved the business cycle problem or more precisely it has reduced the problem to a point that it is a mere shade rather than the most important economic question.

That is, systemic risk is to be reduced in its crosssectional dimension and its time dimension, respectively.” (Jaime Caruana, 2010) The recent BIS papers, designed to create operating macroprudential approach, suggest several leading principles for designing the macroprudential tools. Firstly, they need to be calibrated according to the contribution of each individual institution to the potential systemic risk, regardless of the institution’s legal form, meaning that every important company must be included in the perimeter of the regulation. Secondly, a way should be found to reduce the procyclicality of the financial system. Thirdly, a thorough study of the various available (macroprudential) tools should be conducted, to their potential usefulness and to the empirical evidence of their impact and effectiveness. The BIS analyses have registered many tools used by the Asian countries: (i)  countercyclical capital buffers linked to credit growth (China); countercyclical provisioning (China, India);  (ii)  loan-to-value (LTV) ratios (China, Hong Kong SAR, The Republic of Korea, Singapore);  (iii)  direct controls on lending to specific sectors (The Republic of Korea, Malaysia, Philippines, Singapore) oriented toward managing the aggregate risk throughout the business cycle (i.e. procyclicality);  furthermore, (iv)  capital surcharges for systemically important banks (China, India, Philippines, Singapore);  (v)  liquidity requirements funding (India, The Republic of Korea, Philippines, Singapore ;  (vi)  limits on currency mismatches (India, Malaysia, Philippines);  (vii)  loan to deposit requirements (China, The Republic of Korea), as a tool for managing the aggregate risk in every point in time (systemic oversight).
3 This was a period of great change, when responsibility for financial services was being reallocated between the private and public sectors. In retrospect, it was a success to change the rather undisciplined issuance of banknotes for a standard set by the Riksbank, leaving the private banks free to concentrate upon deposits and lending. Now, 118 years later, we are facing a similar situation: once again, we are discussing how the issuance of money is to be organised and how responsibility can best be allocated to ensure that our payments are secure and effective. Now, as then, opinions are divided over the role the Riksbank should play on the payment market. There are those who are positive to the suggestion of an ekrona and those who are doubtful towards such an initiative from the Riksbank. What I would like to communicate today is the insight that, regardless of whether or not the Riksbank decides to issue an e-krona, the old order will change. We I would like to thank Hanna Armelius, Marianne Sterner and Calum McDonald for all their help with this speech. I would also like to thank my colleagues on the Executive Board of the Riksbank for valuable discussions. Stances and any remaining lack of clarity is entirely my own responsibility. 2 Skingsley, S. (2016). “Should the Riksbank issue e-krona?” Speech at Berns, Stockholm, 16 November. 3 Fahlbeck, P. E. (1900). “Bankreformen” (the bank reform), Statsvetenskaplig tidskrift, (political science journal) vol. 3, no. 5.

In this respect, from the standpoint of income statements, credit institutions have limited room for manoeuvre. Nevertheless, they should avoid imposing indiscriminate rules on customers when they grant new loans; further, they should select borrowers more cautiously and appropriately differentiate the interest rates applied to each of them. Against this background of moderate lending growth and higher loan loss provisions, it does not seem that fees or gains on financial transactions can offset the pressure on the income statement. First, as I just mentioned, because it is unlikely that growth rates will be very high in this more sluggish economic environment in which financial market difficulties persist. And second, because, even if they are, given the weight of these items in income statements, they would be unlikely to act as offsetting mechanisms because of the sheer size of the pressures mentioned earlier. The most effective course of action, and that on which institutions' efforts should focus, is operating expenses. And homing in on operating expenses means not only limiting their growth, but should also lead to reducing those expenses which, because of their nature, are more variable. It is essential to exercise utmost care in taking on overheads, which are difficult to reverse. At a time like the present, it is preferable to have flexible cost structures which enable greater room for manoeuvre. The effort needed is formidable, and will undoubtedly require operating structures to be accommodated to the new competitive reality of the sector.