Global ETF News Older than One Year
IMF-Fiscal Monitor-Balancing Fiscal Policy Risks
April 17, 2012--Overall, fiscal risks remain elevated, according to this issue of the Fiscal Monitor, although there are signs that in some key respects they are less acute than six months ago. Though past efforts with fiscal consolidation are beginning to bear fruit, debt ratios in many advanced economies are at historic levels and rising, borrowing requirements remain very large, financial markets continue to be in a state of alert, and downside risks to the global economy predominate.
In this uncertain environment, fiscal policy must find the right balance between exploiting short-term space to support the fragile recovery and rebuilding longer-term space by advancing fiscal consolidation. Against that background, the issue examines in more detail the concept of fiscal space, or the scope that policymakers have to calibrate the pace of fiscal adjustment without undermining fiscal sustainability.
view IMF Report-Fiscal Monitor Balancing Fiscal Policy Risks
Source: IMF
CPSS-IOSCO issue new standards for financial market infrastructures
April 16, 2012--The Committee on Payment and Settlement Systems (CPSS) and the International Organization of Securities Commissions (IOSCO) have today published three documents that promote global efforts to strengthen financial market infrastructures (FMIs):
a report entitled Principles for financial market infrastructures;
a consultation paper on an Assessment methodology for these new standards; and
a consultation paper on a Disclosure framework for the standards.
New and more demanding international standards for payment, clearing and settlement systems, including central counterparties, have today been issued by the CPSS and IOSCO in a report titled Principles for financial market infrastructures. Among other things, the principles will provide important support for the G20 strategy to make the financial system more resilient by making central clearing of standardised OTC derivatives mandatory. CPSS and IOSCO members will strive to adopt the new standards by the end of 2012. Financial market infrastructures (FMIs) are expected to observe the standards as soon as possible.
Source: IOSCO
New standards for financial market infrastructures issued by CPSS-IOSCO
April 16, 2012--The Committee on Payment and Settlement Systems (CPSS) and the International Organization of Securities Commissions (IOSCO) have today published three documents that promote global efforts to strengthen financial market infrastructures (FMIs):
a report entitled Principles for financial market infrastructures; 1 a consultation paper on an assessment methodology for these new standards; and
a consultation paper on a disclosure framework for the standards.
New and more demanding international standards for payment, clearing and settlement systems, including central counterparties, have today been issued by the CPSS and IOSCO in a report titled Principles for financial market infrastructures. Among other things, the standards will provide important support for the G20 strategy to make the financial system more resilient by making central clearing of standardised OTC derivatives mandatory. CPSS and IOSCO members will strive to adopt the new standards by the end of 2012. Financial market infrastructures (FMIs) are expected to observe the standards as soon as possible.
view the Principles for financial market infrastructurespaper
view the Disclosure framework for financial market infrastructures-Consultative report
Source: BIS
ETFS Precious Metals Weekly: Gold boosted as Fed speeches highlight need for extended period of "highly accommodative" monetary policy
April 16, 2012--Federal Reserve Vice-Chairman's speech lifts precious metals after FOMC sell-off. Gold remains beholden to the communications of central banks, trading choppily in recent weeks as the market weighs the possibility of another round of quantitative easing. Comments by Federal Reserve Vice-Chairman Janet Yellen's comments last week gave a boost to precious metals prices, after she indicated that the US central bank is 'willing and committed to take whatever actions are necessary' to maintain its dual mandate of promoting maximum employment and stable prices.
The US dollar weakened following the speech, leading to gains for all precious metals as investors gained confidence about the potential for further monetary stimulus. With currency debasement a key investment theme for gold investors, the gold price bounced off its lowest level in three months, rallying by 2%.
South African PGM production slumps 50% in February. Official figures released figures last week by Statistics South Africa showed the that platinum group metal (PGM) production in February slumped by nearly 50%. The six-week strike at the Rustenberg mine, responsible for around 15% of global production, was largely to blame for the production loss. However, for the three months ending February, PGM production was down just 2%.
India’s jeweller’s back at work, but for how long? Indian jewellers suspended a three week strike after finance minister Mukherjee said that their demands for the gold excise tax hike to be withdrawn would be given consideration. However, jewellers have given the government until May 11th for the laws to be repealed or the strike would recommence. The Indian parliament convenes on May 7th, giving policymakers around four days to consider the new budget measures and possible alternatives.
visit www.etfsecurities.com for more info
Source: ETF Securities
Dubai Gold & Commodities Exchange Weekly Market Commentary
April 15, 2012--Economic Data Overview
A recurring pattern is emerging as we enter the second quarter of 2012--this is the year of safe haven plays. The year began with a rush into the dollar and out of the euro as US and German fixed income markets reached all-time highs. Last week the same themes dominated trading. US economic data in April has been much weaker that expected but investors have still chosen the dollar and gold as well as strongly rated government debt markets to invest in.
The story has wavered between US recovery and European collapse in the last four months. Last week, the European debt crisis overshadowed trading.
Spain is at the centre of the crisis. The fourth largest economy in Europe is too big to fail. Mounting austerity measures in a shrinking economy with spiralling yields and massive unemployment is a formula that does not compute. Already this month, debt markets have shown little appetite for the nation's latest bond auction. Yields are at the 6% bailout trigger level we have seen in other Euro bloc nations. While the price of protective credit default swaps has also ballooned. The ECB has now got to prevent peripheral European bonds from falling off a cliff, as the market is lining up Italy in its sights. Italy is one of the largest bond markets in the world and cannot be saved from default by the ECB and or the IMF, if the European contagion continues. There is a growing debate as to whether the ECB will begin its bond purchase program to steady crisis bound debt markets. Many believe that even if a renewed purchase program is undertaken it will not be able to sooth investors' fears.
Away from Europe, Chinese economic growth disappointed last week, growing at 8.1% its lowest rate in three years. This is part of a developing story that countries which were expected to be the engine of global recovery have not lived up to expectations. India is another nation that is beset by economic worries and last week its currency fell to its lowest level since the middle of January. Major world stock markets posted their worst weekly performance in 2012, last week. This may be a worrying headline, but equities have been so strong in 2012 and corrections so mild, that last week's losses are being overstated. There is a growing demand for growth investments and US equities in particular are expected to attract strong buying interest even if this correction lasts another few weeks. It is this type of optimistic outlook that has help oil stay above $100 and maintain the pivotal 100 day moving average at $98.69.
Looking to the week ahead, a G20 meeting at the weekend will be closely watched for developments, as another plan is needed if the European debt crisis is to be controlled. On the economic calendar the market will watch US retail sales which are expected to come in much lower than March's number, UK and European inflation data which are expected to be higher in the UK and flat in Europe. Meanwhile German PPI will also be important as inflation concerns in Europe's strongest economy remain a concern. News that China is going to allow its exchange rate trade in a 1% band is a global growth positive which should help gold and the dollar this week
Source: Dubai Gold and Commodities Exchange (DGCX)
Implementation of stress testing practices by supervisors: Basel Committee publishes peer review
April 13, 2012--The Basel Committee on Banking Supervision has today published a peer review of the implementation by national supervisory authorities of the Basel Committee's principles for sound stress testing practices and supervision.
Stress testing is an important tool used by banks to identify the potential for unexpected adverse outcomes across a range of risks and scenarios. In 2009, the Committee reviewed the performance of stress testing practices during the financial crisis and published recommendations for banks and supervisors entitled Principles for sound stress testing practices and supervision. The guidance set out a comprehensive set of principles for the sound governance, design and implementation of stress testing programmes at banks, as well as high-level expectations for the role and responsibilities of supervisors.
view the Principles for sound stress testing practices and supervision
Source: BIS
World Economic Outlook (WEO): Growth Resuming, Dangers Remain
April 13, 2012--The World Economic Outlook (WEO) presents the IMF staff's analysis and projections of economic developments at the global level, in major country groups (classified by region, stage of development, etc.), and in many individual countries.
It focuses on major economic policy issues as well as on the analysis of economic developments and prospects. It is usually prepared twice a year, as documentation for meetings of the International Monetary and Financial Committee, and forms the main instrument of the IMF's global surveillance activities.
view World Economic Outlook (WEO) Growth Resuming, Dangers Remain
Source: IMF
Global Emerging Markets- Increased volatility in equity markets
April 12, 2012--Global markets have seen extraordinary levels of volatility in the second half of 2011. Fiscal and regulatory uncertainty across the developed world has roiled markets and hampered growth prospects. Standard & Poor's (S&P) downgraded US sovereign debt below AAA for the first time in history, while the euro zone sovereign debt crisis engulfed France, Italy and Spain. US consumer confidence has dropped to crisis-level lows,[1] and the Misery Index[2] is at its highest in nearly 30 years.
Through mid-November, the MSCI Emerging Markets Index was down 15.8%, compared with a loss of 6.9% for the MSCI global benchmark.[3] The biggest underperformers are Brazil, Hungary and Poland, with each down more than 20% for the year. Indonesia has been the bright spot among emerging market equity performance with a year-to-date gain of nearly 4.5%.[4] Robust Gross Domestic Product (GDP) growth, strong domestic demand and declining inflationary pressures have boosted economic growth and profit forecasts for Southeast Asia’s largest economy.
Source: Mirae Asset Management
Mirae-EMEA (Europe, Middle East, Africa)
April 12, 2012--Russia
Political uncertainty abates
Russia has fared better in the current market turmoil than in the 2008 crisis. Corporate debt levels are more manageable, with longer duration and a lower proportion of foreign currency loans. The central bank has allowed the ruble to float more freely and, thus, has avoided an attack on the currency. Inflation also remains under control.
CE3 (Czech Republic, Hungary, Poland) -
Proximity to euro zone remains a detriment
We remain cautious on the region given its close proximity to the euro zone. All three countries have close ties to euro zone countries, and especially to Germany. For example, exports make up 68% of GDP in the Czech Republic, two-thirds of which go directly to euro zone countries. Therefore, any slowdown in Europe directly affects these countries. On top of external shocks, Hungary continues to be plagued by policy uncertainty. To reduce the budget deficit, the government continues to go after profitable companies in the forms of higher taxes and mandated wage increases for workers (which then increases income tax revenue). In addition, currency weakness especially relative to the Swiss franc has put the consumer under pressure given the large amount of mortgage loans issued in Swiss francs. Poland, with a large domestic economy, a stable and generally market-friendly government and less exposure to the euro zone, is the best positioned country in the region. While some consumers are under pressure from having Swiss franc loans, and the government will look to consolidate fiscal policy further, economic growth is still likely in Poland.
Turkey - Unconventional monetary policies
]While Turkey has the best demographics and long-term economic growth potential of any major market in EMEA, the short-term outlook is uncertain. Turkey finds itself in an awkward position of trying to moderate the economy, while at the same time keeping the lira and inflation stable.
Source: Mirae Asset Management
Deutsche Bank seeks revamp
April 12, 2012--Deutsche Bank's incoming co-chief executive is planning an overhaul of its operations, aiming to make its wealth and asset management operations work more closely with its investment banking arm in bid to emulate the business model of Swiss rivals Credit Suisse and UBS.
Anshu Jain will make such a deeper collaboration one of his top priorities in the first 18 months of his tenure which will start this June, people close to the situation said.
Source: FT.com
