Islamic financial system lays down rules of conduct and contractual arrangements, and offers feasible financing structure which emphasize trade and equity financing that together will help the much needed financial diversification in Islamic countries. Islamic finance also has potential to blend economic and social objectives and address the ethical aspects of financing effectively.
Describing policy in terms of time could also risk limiting the Committee’s flexibility to respond to the data if we continue to see an improving economy. Instead, I believe we should describe how we will respond to the data; that is, we should describe a reaction function. I frequently consider such reaction functions as I think about policy.