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New WisdomTree ETF on Xetra: Diversified Commodity Investment with Roll Optimisation
July 12, 2021--Since Monday, a new exchange traded fund of the issuer WisdomTree is tradable via Xetra and Börse Frankfurt.
The WisdomTree Enhanced Commodity ex-Agriculture UCITS ETF enables investors to invest in a basket of different futures on energy commodities, precious metals and industrial metals, which each make up one third of the total portfolio.
Name: WisdomTree Enhanced Commodity ex-Agriculture UCITS ETF
Asset class: Commodity ETF
ISIN: IE00BDVPNV63
Ongoing charges: 0.60 per cent
Distribution policy: Accumulating
Reference index: MS RADAR ex Agriculture & Livestock Commodity Index
The product offering in Deutsche Börse's XTF segment currently comprises a total of 1,668 ETFs. With this selection and an average monthly trading volume of around €17 billio, Xetra is the leading trading venue for ETFs in Europe.
Source: Xetra
ESMA consults on the review of transparency requirements under MiFIR
July 9, 2021--The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has today launched a Consultation Paper on the review of the regulatory technical standards-RTS 1 equity and RTS 2- non-equity transparency-on transparency requirements under the Markets in Financial Instruments Regulation (MiFIR).
The Consultation Paper focuses on technical issues and addresses topics that do not require a prior change of MiFID II/MiFIR. The review includes:
providing more clarity on non-price forming transactions and the reporting of such transactions which will help obtain a better picture of the actual split between lit and over-the-counter (OTC) trading;
a recalibration of the regime for commodity derivatives ensuring better tailored transparency requirements for this class of derivatives);
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Source: ESMA
ECB Meeting of 9-10 June 2021 Account of the monetary policy meeting of the Governing Council of the European Central Bank
July 9, 2021-- Held in Frankfurt am Main on Wednesday and Thursday, 9-10 June 2021
1. Review of financial, economic and monetary developments and policy options
Financial market developments
Ms Schnabel reviewed the financial market developments since the Governing Council's previous monetary policy meeting on 21-22 April 2021.
The nominal euro area ten-year GDP-weighted sovereign bond yield had increased by around 5 basis points,
while short to medium-term yields had remained broadly unchanged.
Taking into account also broader developments since the Governing Council's 10-11 March meeting, a mild steepening of the yield curve could be observed- a typical phenomenon of an economy on the verge of recovery. Long-term US Treasury yields, meanwhile, had remained largely unchanged over the same period.
Market intelligence pointed to two key drivers behind the diverging yield developments in the euro area and the United States. The first factor related to the pace of vaccination, which had been accelerating in all major euro area countries. As a result, the euro area was now expected to close most of the vaccination gap with the United States by the start of the summer. A high proportion of vaccinations had also strengthened investor confidence in the resilience of the euro area recovery.
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Source: ECB
ESMA consults on derivatives clearing and trading obligations in view of the benchmarks transition
July 9, 2021--The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, today launches a consultation on the review of the regulatory technical standards (RTS) specifying classes of derivatives subject to the clearing (CO) and trading obligations (DTO).
The Consultation Paper examines the state of the transition away from EONIA and LIBOR, which will cease to exist, and onto alternative risk-free rates, such as €STR, SONIA and SOFR, in the OTC interest rate derivatives market.
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Source: ESMA
Lyxor Appoints Solactive Again for the Release of their Third Green Bond ETF, the Lyxor Euro Government Green Bond (DR) UCITS ETF
July 8, 2021-Climate change plays a significant role in our society for decades to come. Tackling rising temperatures is, therefore, not simply an environmental issue but also an economic necessity. According to the British non-profit Climate Bonds Initiative (CBI), financial professionals regard green bonds as one way to come to grips with climate change. In the first quarter of 2021, CBI reports the issuance of USD 106.86 billion in green bonds.
In 2020, the global issuance of green bonds exceeded the $1 trillion mark[1]. Building on this positive development, Green Bond pioneer Lyxor now released its new Lyxor Euro Government Green Bond (DR) UCITS ETF tracking the Solactive Euro Government Green Bond Index.
Both the attractivity and importance of green bond investing are undeniable. Between 2015 and 2020, the amount of green bond investing grew by a steady 60% per year, and the World Economic Forum expects the sum of global green bonds to achieve USD 2.36 trillion by 2023[2].
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Source: Solactive AG
Brussels to push for greater ETF trade transparency
July 8, 2021--Brussels will submit proposals to increase transparency and reduce the cost of market data with the aim of increasing the competitiveness of the EU exchange-traded fund industry.
Tillman Luder, head of the European Commission's securities markets division, said Brussels is currently discussing the development of integrated tapes with data providers.
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Source: FT.com
UK and Brussels clash over 40bn pound Brexit divorce bill-FT
June 8, 2021--In a latest Brexit update, published early Friday morning in Asia, the Financial Times (FT) said, "Brussels and London were on Thursday locked in a dispute over the size of the UK's Brexit bill, after the EU suggested that Britain would be obliged to pay€47.5bn (£40.8bn) as part of its post-Brexit arrangements."
"But the UK Treasury insisted that the Brexit divorce settlement remained within its previous central range of £35bn-£39bn. An updated estimate is to be published next week," added FT.
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Source: FT.com
The risks from climate change to sovereign debt in Europe
July 8, 2021--European Union institutions and national fiscal authorities should incorporate climate risk in debt sustainability analysis.
The exposure of European Union sovereigns to climate risks can be acute, from extreme weather, or chronic, from the productivity effects of gradual temperature increase, increased sea levels and the transition to a low-carbon economy that results in repricing of assets.
Climate-related innovations can also spur growth. These risks are priced by investors and can affect sovereign credit ratings.
Governments and fiscal stability authorities have an interest in the sovereign-debt implications of climate change being transparent.
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Source: bruegel.org/
ECB Unveils Policy Regime Change That Lets Inflation Overshoot
July 8, 2021--The European Central Bank raised its goal for inflation and may let it overshoot the target for a while, giving officials more discretion in how to bolster the economy after years of lackluster performance.
In the culmination of an 18-month review published Thursday, policy makers agreed to seek consumer-price growth of 2% over the medium-term with a "symmetric" aim.
The ECB said that when interest rates are close to their lower limit, as now, the economy will need "especially forceful" monetary stimulus that could "imply a transitory period in which inflation is moderately above target."
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Source: finance.yahoo.com
How have the European Central Bank's negative rates been passed on?
July 7, 2021--Negative rate cuts are not that different from 'standard' rate cuts. Like them, they reduce banks' margins, but this effect does not appear to be amplified below 0%.
Since the global financial crisis, several central banks have deployed negative policy rates, after exhausting conventional easing measures.
The European Central Bank introduced its negative interest rate policy (NIRP) in June 2014 when it cut its deposit facility rate below 0% for the first time, to -0.1%. Since then, the rate has been cut four more times, by 10 basis points each time, to reach -0.5% in September 2019. After seven years of NIRP and with markets currently expecting rates to stay negative for the next five years, it is crucial to fully understand the effects of prolonged negative rates on the economy.
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Source: bruegel.org