Americas ETP News
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Federal Open Market Committee Statement
August 9, 2011--Information received since the Federal Open Market Committee met in June indicates that economic growth so far this year has been considerably slower than the Committee had expected. Indicators suggest a deterioration in overall labor market conditions in recent months, and the unemployment rate has moved up. Household spending has flattened out, investment in nonresidential structures is still weak, and the housing sector remains depressed. However, business investment in equipment and software continues to expand. Temporary factors, including the damping effect of higher food and energy prices on consumer purchasing power and spending as well as supply chain disruptions associated with the tragic events in Japan, appear to account for only some of the recent weakness in economic activity.
Inflation picked up earlier in the year, mainly reflecting higher prices for some commodities and imported goods, as well as the supply chain disruptions. More recently, inflation has moderated as prices of energy and some commodities have declined from their earlier peaks. Longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee now expects a somewhat slower pace of recovery over coming quarters than it did at the time of the previous meeting and anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate. Moreover, downside risks to the economic outlook have increased. The Committee also anticipates that inflation will settle, over coming quarters, at levels at or below those consistent with the Committee's dual mandate as the effects of past energy and other commodity price increases dissipate further. However, the Committee will continue to pay close attention to the evolution of inflation and inflation expectations.
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Source: FBR
XTF Data Now Available on RIMES
August 9, 2011--RIMES Technologies, the award-winning benchmark data service provider, today announced that it has become the first data integrator to offer ETF ratings and analytical data from XTF, the global research and advisory firm dedicated to helping investors harness the power of Exchange Traded Funds.
XTF offers a focused range of technical and fundamental research, financial services and technologies that help investors understand the role ETFs play in enhancing investment returns and managing risks; they developed a quantitative, transparent, rules-based ETF ratings process which is rapidly becoming the industry standard by which all ETFs can be evaluated and compared. XTF offers the most comprehensive and analytical ETF data available today.
The XTF database evaluates the structural integrity and investment metric of every ETF including all costs, liquidity, tracking error, returns and risk. XTF also maintains the complete listing of every US-listed ETF and every component and component weight back to inception for every ETF on a daily basis. The data includes all rebalancing, cash components, excluded assets, and distributions automatically adjusted for on a daily basis, together with the Total Return of the ETF and the Total Return of the corresponding underlying index on a daily basis. ETFs are added and corresponding data made available usually by the first day of trading.
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Source: XTF
Deutsche Bank's db-X Opens NYSE Arca on August 9
August 9, 2011--Deutsche Bank's db-X Group will ring the opening bell to commence trading on NYSE Arca today. The opening ceremony commemorates the launch of the db-X Exchange Traded Fund (ETF) platform in the United States.
On June 9, 2011, Deutsche Bank launched the db-X US platform with five currency-hedged ETFs designed to provide investors with exposure to international equity markets while at the same time mitigating exposure to fluctuations between the value of the US dollar and selected international currencies. The db-X US platform now consists of the following 10 funds:
db-X MSCI Japan Currency-Hedged Equity Fund (nyse arca:DBJP)
db-X MSCI Brazil Currency-Hedged Equity Fund (nyse arca:DBBR)
db-X MSCI Canada Currency-Hedged Equity Fund (nyse arca:DBCN)
db-X MSCI EAFE Currency-Hedged Equity Fund (nyse arca:DBEF)
db-X MSCI Emerging Markets Currency Hedged Equity Fund (nyse arca:DBEM)
db-X 2010 Target Date Fund (nyse arca:TDD)
db-X 2020 Target Date Fund (nyse arca:TDH)
db-X 2030 Target Date Fund (nyse arca:TDN)
db-X 2040 Target Date Fund (nyse arca:TDV)
db-X In-Target Date Fund (nyse arca:TDX)
"Deutsche Bank has been effectively providing US investors with a variety of innovative exchange traded products across asset classes for over five years," said Martin Kremenstein, Chief Investment Officer of Deutsche Bank's db-X North America business. "With the recent launch of the five currency-hedged ETFs together with the recent rebranding of the five target date ETFs, we are building on the success of our existing ETF platform in the US to offer distinctive solutions to our clients."
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Source: Deutsche Bank
Fed holds short-term rates to mid-2013
August 9, 2011--The US Federal Reserve has attempted to tackle a rapidly weakening economy by freezing short-term interest rates for two years and opening the door to more quantitative easing, in a move that sent the dollar and Treasury yields sharply lower.
The rate-setting Federal Open Market Committee said: “The committee currently anticipates that economic conditions – including low rates of resource utilisation and a subdued outlook for inflation over the medium run – are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.”
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Source: FT.com
S&P Balks at SEC Proposal to Reveal Rating Errors
August 8, 2011--Standard & Poor's, whose unprecedented downgrade of U.S. debt triggered a worldwide stocks sell-off, is pushing back against a U.S. government proposal that would require credit raters to disclose "significant errors" in how they calculate their ratings.
S&P, which was accused by the Obama administration of making an error in its calculations leading to Friday's downgrade, raised concern about the proposed new corrections policy and other issues in an 84-page letter to the Securities and Exchange Commission, dated August 8.
Source: Reuters
Investors Using ETPs more for Risk Management
August 8, 2011--Stomach-turning global volatility has bolstered demand for certain alternative exchange-traded products used by institutions to quickly hedge their portfolios or make directional bets to profit from market instability.
“We've seen pretty significant year-to-date increases on inverse” exchange-traded products, said Russ Koesterich, managing director and global chief investment strategist in San Francisco for BlackRock Inc.'s iShares business. “In general, investors are using these products to position against what they think might be a dour movement of assets and they want to hedge part of that exposure.”
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Source: Pensions & Investments
Mexico: Selected Issues
August 8, 2011--I. POTENTIAL GROWTH AND THE OUTPUT GAP IN MEXICO
1
Decomposing the growth process in trend and cyclical factors represents an important
challenge, with implications for policy decisions. This paper applies several methodologies to the case of Mexico and tries to assess to what extent these methodologies adequately capture cyclical changes.
The results suggest that care is needed when using these indicators
in real time to assess the stage of the cycle, particularly in the presence of large shocks, and that a variety of macroeconomic indicators are needed to evaluate and validate the results.
A. The Output Gap
1. Estimates of the output gap are important for the conduction of macroeconomic
policies. The central bank‘s inflation targeting framework entails assessing if the projected output implied by the monetary policy stance is consistent with the inflation target.
view IMF paper-Mexico: Selected Issues
Source: IMF
FlexShares files with the SEC
August 8, 2011--FlexShares has filed a pre-effective amendment no. 1, registration statement with the SEC for the
FlexSharesSM Morningstar US Market Factor Tilt Index Fund
FlexSharesSM Morningstar Global Upstream Natural Resources Index Fund
FlexSharesSM iBoxx 3-Year Target Duration TIPS Index Fund
FlexSharesSM iBoxx 5-Year Target Duration TIPS Index Fund
FlexSharesSM iBoxx 7-Year Target Duration TIPS Index Fund
view filing
Source: SEC.gov
FlexShares files with the SEC
August 8, 2011--FlexShares has filed an amended and restated application for exemptive relief with the SEC for actively-managed ETFs.
view filing
Source: SEC.gov
CME Clearing is Not Planning to Adjust Haircuts Following S&P Rating Change to U.S.
August 8, 2011--CME Clearing President Kim Taylor made the following statement regarding the recent S&P change to the U.S.'s AAA credit rating:
"CME Clearing has evaluated the market situation surrounding the U.S. downgrade and has determined that there is no current need for changes to our collateral haircuts or policies for accepting U.S. Treasuries as margin collateral.
We will continue to monitor the liquidity environment and advise market participants if the environment changes."
CME Group has been helping customers manage their risk through a variety of market conditions for over 150 years. We are proud of our strong track record and are confident that our risk methodologies will protect the markets and market users we serve.
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Source: CME
