Global ETF News Older than One Year
IMF-The Costs of Misreading Inflation
January 24, 2023--The 2021 surge in global shipping costs was a canary in the coal mine for the persistent rise in inflation
It bears remembering that, as recently as the second half of 2021, the Federal Reserve considered that the surge in consumer price inflation would dissipate, with price increases returning to the Fed’s 2 percent target in 2022.
In testimony before Congress, Fed Chair Jerome Powell affixed the now infamous "transitory" moniker to the ongoing price increases, which he ascribed to temporary supply bottlenecks and price declines in the early stages of the pandemic.
Source: imf.org
BlackRock's iShares regains pole position from rival Vanguard
January 24, 2023--Last year's net ETF flows at $221bn were lower than in 2021, but Vanguard's $214bn marked a far steeper decline.
BlackRock's iShares exchange traded fund arm dethroned arch-rival Vanguard at the top of the global ETF net flows leaderboard last year, returning to pole position after two years in second place.
But the big two also entrenched their duopoly in the ETF industry, with nearest rivals State Street Global Advisors and Invesco suffering deeper wounds from souring market sentiment.
Source: ft.com
Smart beta rewards discerning devotees in 2022
January 20, 2023-Momentum, value and 'low investment' rack up returns of 11-15% while broad markets lost a fifth of their value
Smart beta strategies, which aim to outperform traditional broad market capitalisation-weighted indices by filtering them according to certain factors, delivered returns as high as 15 per cent last year even as major markets fell by a fifth.
Research by Scientific Beta, a factor-based data provider and consultancy, has found that value strategies- investing in global stocks deemed to be inexpensive- delivered returns of 11 per cent compared to losses of between 17 and 18 per cent for global cap-weighted indices such as the Scientific Beta Global Cap-Weighted index, FTSE All-World index and MSCI ACWI index.
Source: ft.com
Sustainable central banking: clear green water between the Fed and the ECB?
January 18, 2023--All major central banks recognise that the climate crisis and nature loss pose material threats for the financial system. But central bank mandates and political environments vary. Action on sustainability is a bipartisan issue in Europe, while in the US parts of the Republican Party are leading an ant-ESG campaign that is out of line with science and at odds with a prudent view on financial management.
Nick Robins writes that a second phase of sustainable central banking is needed to minimise the environmental threats to banks' core mandates, as well as the other goals they are set.
One of the big sustainable finance priorities for 2023 is how central banks will grapple with deepening climate and nature risks alongside high inflation and rising interest rates. One thing is clear: all major central banks recognise that the climate crisis and nature loss pose material threats for the financial system, requiring them to act to understand and address these challenges. Where they diverge depends very much on the mandates they are given by legislators, the interpretations they make and the political environment in which they operate. These differences were clearly on display in January in interventions from US and European central bankers.
Source: blogs.lse.ac.uk
Crypto Contagion Underscores Why Global Regulators Must Act Fast to Stem Risk
January 18, 2023--Stronger financial regulation and supervision, and developing global standards, can help address many concerns about crypto assets
The already volatile world of crypto has been upended anew by the collapse of one its largest platforms, which highlighted risks from crypto assets that lack basic protections.
The losses punctuated an already perilous period for crypto, which has lost trillions of dollars in market value.
Bitcoin, the largest, is down by almost two-thirds from its peak in late 2021, and about three-quarters of investors have lost money on it, a new analysis by the Bank for International Settlements showed in November.
Source: imf.org
WEF-Unchecked Cyberattacks 'Are Growing Threat to Fragile Global Economy'
January 17, 2023--Adoption of connected devices during the pandemic led to a dramatic increase in cyberattacks. According to a new report launched today at the World Economic Forum Annual Meeting 2023, if left unchecked, the cost of cyberattacks will continue to rise, threatening a fragile global economy.
The report, The State of the Connected World 2023 edition, a collaboration of the World Economic Forum with the Council on the Connected World, says the immediate threats can be mitigated through robust security protocols and governance through public-private cooperation.
view the WEF State of the Connected World 2023 Edition
Source: weforum.org
WEF-Chief Economists Outlook: January 2023
January 16, 2023--The January 2023 Chief Economists Outlook is published amid continuing economic uncertainty and challenges of historic proportions. As the world puts another tumultuous year behind it, governments, businesses and households will all have to grapple with persistent headwinds throughout 2023.
Financial conditions remain tight, with little scope for significant loosening, despite much of the world economy being at risk of recession. However, according to the latest survey of the World Economic Forum's Community of Chief Economists, there are tentative grounds for optimism, including the prospect of an easing of the cost-of-living and energy crises by the end of this year.
view the WEF
Source: WEF (world Economic Forum)
The global growth story of the 21st century: driven by investment and innovation in green technologies and artificial intelligence
This new growth story is beginning: in the next 5 years more than half of the tipping points for crucial green technologies will have been met, making them competitive in key markets. The process of structural and systemic change will be multi-decadal. But this decade is decisive to limit the risk of greater climate instability. Acceleration now is essential. AI is creating real opportunities for this acceleration.
The faster growth of Emerging Markets and Developing Economies (EMDEs) relative to richer countries and the location of renewable energy sources will change the world's industrial geography and patterns of trade. If managed well, these changes can make supply chains more diverse and less fragile; multiple sources of key products and inputs will be necessary. The race has started, with countries across the world competing in investment support to gain dynamic comparative advantage, such as the $1trn US Inflation Reduction Act with its strong focus on green technologies.
Source: weforum.org
WEF-Global Risks Report 2023
The first years of this decade have heralded a particularly disruptive period in human history. The return to a "new normal" following the COVID-19 pandemic was quickly disrupted by the outbreak of war in Ukraine, ushering in a fresh series of crises in food and energy-triggering problems that decades of progress had sought to solve. view the World Economic Forum Global Risks Report 2023
Source: WEF (World Economic Forum)
Sharp, Long-lasting Slowdown to Hit Developing Countries Hard
Given fragile economic conditions, any new adverse development-such as higher-than-expected inflation, abrupt rises in interest rates to contain it, a resurgence of the COVID-19 pandemic, or escalating geopolitical tensions-could push the global economy into recession. This would mark the first time in more than 80 years that two global recessions have occurred within the same decade.
The global economy is projected to grow by 1.7% in 2023 and 2.7% in 2024. The sharp downturn in growth is expected to be widespread, with forecasts in 2023 revised down for 95% of advanced economies and nearly 70% of emerging market and developing economies.
Source: worldbank.org
January 13, 2023--The world has in its hands a new growth and development story driven by investment and innovation in green technology, boosted by artificial intelligence (AI); it is a much more attractive and inclusive story than the dirty and destructive paths followed in the past.
January 11, 2023--January 11, 2023--The world faces a set of risks that feel both wholly new and eerily familiar. The Global Risks Report 2023 explores some of the most severe risks we may face over the next decade. As we stand on the edge of a low-growth and low-cooperation era, tougher trade-offs risk eroding climate action, human development and future resilience.
January 10, 2023--2023 global growth to slow to 1.7% from 3% expected six months ago
Global growth is slowing sharply in the face of elevated inflation, higher interest rates, reduced investment, and disruptions caused by Russia's invasion of Ukraine, according to the World Bank's latest Global Economic Prospects report.
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