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Federal Reserve Board announces the extensions of its temporary U.S. dollar liquidity swap lines and the temporary repurchase agreement facility for foreign and international monetary authorities (FIMA repo facility) through March 31, 2021
July 29, 2020--July 29, 2020--The Federal Reserve on Wednesday announced the extensions of its temporary U.S. dollar liquidity swap lines and the temporary repurchase agreement facility for foreign and international monetary authorities (FIMA repo facility) through March 31, 2021. These facilities were established in March 2020 to ease strains in global dollar funding markets resulting from the COVID-19 shock and mitigate the effect of such strains on the supply of credit to households and businesses, both domestically and abroad.
The extensions of these facilities will help sustain recent improvements in global U.S. dollar funding markets by maintaining these important liquidity backstops. In addition, the FIMA repo facility will help support the smooth functioning of the U.S. Treasury market by providing an alternative temporary source of U.S. dollars other than sales of securities in the open market.
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Source: federalreserve.gov
ETFs are the canary in the bond coal mine
July 29, 2020--Exchange traded funds deserve more scrutiny in light of March's market turmoil
Ever since the 2008 financial crisis, policymakers and pundits have wondered what would happen to the cogs of finance in the next big global market shock. Now, they have a test case to dissect: the widespread market drama that occurred in March as Covid-19 spread worldwide and economies began locking down.
While it is still too early to pass definitive judgment on the overall resilience of banks and finance-since the full tally of Covid-19 pain remains unclear-some curious micro-lessons are emerging that deserve more debate.
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Source: FT.com
Fed buying spree could move to long end of yield curve: analysts
July 29, 2020--The Federal Reserve may shift more of its buying to the long end of the yield curve, analysts say, as the Treasury market braces for a surge in supply to finance relief efforts in the wake of the coronavirus pandemic.
Such a move, which is not expected before the central bank's September meeting, would avert a potential mismatch in Treasury supply and demand and help stabilize long-end rates.
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Source: reuters.com
U.S. GDP likely sank a record 35% in the 2nd quarter after coronavirus ravaged the economy
July 29, 2020--U.S. GDP set to post biggest decline since World War Two
The U.S. suffered the biggest economic decline in the second quarter since the government began keeping track after World War Two. How much? Try 30%-or more.
Economists polled by MarketWatch estimate gross domestic product-the official scorecard for the U.S. economy-contracted by a record 34.6%annual pace from the start of April to the end of June.
Before the coronavirus pandemic, the largest drop in GDP on record was 10% in 1958. The government's quarterly GDP figures go back to 1947.
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Source: marketwatch.com
JPMorgan's development finance arm structures first deal
July 28, 2020--JPMorgan's development finance institution has structured its first deal, a $250 million five-year green bond for a power firm in Georgia, as it targets $100 billion for development projects annually, executives say.
The deal for Georgia Global Utilities, to be settled on Thursday, is the first where that arm of the bank has been named development finance structuring agent.
Adding developmental finance and green funding to the deal, meaning capital is raised to support economic development and environmental projects, helped entice a broader range of investors, said Stefan Weiler, head of Central and Eastern Europe, Middle East and Africa debt capital markets at JPMorgan.
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Source: finance.yahoo.com
State Street Global Advisors Launches S&P 500 ESG ETF
July 28, 2020--Newest SPDR ETF Offers Investors An ESG Alternative for Flagship Equity Benchmark
State Street Global Advisors, the asset management business of State Street Corporation (NYSE: STT), today announced the launch of the SPDR(R) S&P 500 ESG ETF (EFIV).
Providing investors an opportunity to tap into ESG investing at the core of their portfolio with an expense ratio of just 10 basis points, EFIV enhances both SPDR's ESG and S&P 500 ETF offerings, seeking to help investors incorporate ESG while achieving a risk and return profile comparable to the S&P 500.
EFIV seeks to track the S&P 500 ESG Index (the "Index"), which is designed to measure the performance of securities meeting certain sustainability criteria (i.e., criteria related to environmental, social and governance factors), while maintaining a similar overall industry group weight as the S&P 500 Index.
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Source: State Street Global Advisors
CIBC Asset Management launches two global equity ETFs
July 27, 2020--Today CIBC Asset Management Inc. launched CIBC Global Growth ETF and CIBC International Equity ETF, two new actively-managed exchange-traded funds (ETFs) that provide investors with global diversification to equity securities.
"Diversification across global markets is essential for investors' portfolios and we are pleased to offer active ETF solutions to meet these needs," says David Scandiffio, President and CEO, CIBC Asset Management.
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Source: crweworld.com
Nationwide Risk-Managed Income ETF breaks the $100 million threshold
July 27, 2020--At a time when interest rates are pervasively near historic lows and income investors are concerned about heightened market uncertainty, the Nationwide Risk-Managed Income ETF has surpassed the $100 million mark of assets under management by serving the needs of investors seeking income with a measure of downside protection since its inception on Dec. 19, 2019.
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Source: Nationwide
Why Growth in the Fed's Asset Portfolio Has Paused
July 26, 2020--That doesn't mean the central bank has dialed back its support for markets or the economy.
The Fed's holdings of bonds, loans and other assets reached $7 trillion in June, up from $4.2 trillion in February, reflecting multiple financial-assistance programs launched in response to the coronavirus pandemic.
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Source: wsj.com
Zero-fee ETFs fail to capture investor interest
July 26, 2020--Slow progress of recently launched vehicles contrasts with $9bn raised by Fidelity's tracker funds
Innovative tracker funds that were launched to great fanfare because of their negative or non-existent fees have failed to gather significant assets, underlining the challenges facing new entrants to the cut-throat passive investment market.
The ferocious price war among index fund managers has prompted some providers to cut fees to zero in a bid to draw investor interest. An exchange traded fund launched last year went one step further by becoming the first fund to apply a negative fee, meaning that investors were effectively paid to invest.
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FT.com
