I would also like to mention here that SBP is also a key member of the recently constituted steering committee for the promotion of Islamic banking by the government which is mandated to devise a comprehensive policy framework for the Islamic financial system, suggest practical steps needed to be taken for implementing Shariah-based financial system, and propose solutions for the Islamic secondary market / money market for liquidity management.
With compressed risk spreads, this means that borrowing costs for many private-sector borrowers remain very low. The spreads over German yields for European sovereigns have continued to fall. This suggests that actions by European policymakers have had more influence on European markets than actions by the US authorities. This is as one would expect, but it hasn’t always been the case in the past.