Global ETF News Older than One Year
BlackRock analysis helps define climate-change risk
April 4, 2019--Study says investors fail to price in effect of extreme weather on portfolios
Investors underestimate the risks that extreme weather poses to their portfolios, according to landmark research by BlackRock that could drastically alter how the investment industry considers climate change in its risk management processes.
BlackRock's study looked at three US asset classes-municipal bonds, commercial real estate and US utility stocks-and said climate change was already having a tangible effect on securities. It warned that the trend would only accelerate.
Source: FT.com
IMF-Global Financial Stability Report-Chapter 2: Downside Risks to House Prices
April 4, 2019--Chapter 2 studies and quantifies house prices at risk, a measure of downside risks to future house price growth-using theory, insights from past analyses, and new statistical techniques applied to 32 advanced and emerging market economies and major cities. The chapter finds that lower house price momentum, overvaluation, excessive credit growth, and tighter financial conditions predict heightened downside risks to house prices up to three years ahead.
The measure of house prices at risk helps forecast downside risks to GDP growth and adds to early-warning models for financial crises. Policymakers can use estimates of house prices at risk to complement other surveillance indicators of housing market vulnerabilities and guide macroprudential policy actions aimed at building buffers and reducing vulnerabilities. Downside risks to house prices could also be relevant for monetary policymakers when forming their views on the downside risks to the economic and inflation outlook. Authorities considering measures to manage capital flows might also find such information useful when a surge in capital inflows increases downside risks to house prices and when other policy options are limited.
view the IMF-Global Financial Stability Report-Chapter 2: Downside Risks to House Prices
Source: IMF
World Economic Forum-Why globalization needs an upgraded operating system
April 4, 2019--The G20 Leaders' Summit in London on April 2, 2009, is widely regarded as one of the best examples of global cooperation in a generation. Meeting as a group for only the second time, leaders of the world's top economies, accounting for some 85% of global GDP, agreed to provide $5 trillion in fiscal stimulus and $1 trillion in additional resources to the International Monetary Fund, and to implement a wide-ranging program of financial regulatory reform.
Coming on the heels of the 2008 financial crisis, the summit was instrumental in restoring confidence in capital markets and bringing the global economy out of its freefall.
The 2008 crisis showed that the international community had been far too complacent about adapting financial governance to the effects of new technologies and changing market and macroeconomic conditions. A decade later, we find ourselves in a similar situation.
view the World Economic Forum Globalization 4.0 Shaping a New Global Architecture in the Age of the Fourth Industrial Revolution A Call for Engagement White paper
Source: World Economic Forum
World Gold Council-Global gold-backed ETF holdings grew incrementally in March
Global gold-backed ETF flows remain positive on the year (US$1.9bn, 1.9% AUM) on the back of strong January inflows.
Regional fund flows
Source: World Gold Council
Economic Forces, Not Tariffs, Drive Changes in Trade Balances
Some policymakers are concerned that their large and rising size are the result of uneven measures that distort international trade. But is a focus on bilateral trade balances the right one?
Source: IMF
IOSCO report on behavioural insights seeks to enhance retail investor protection
The report describes behavioural biases and how they affect retail financial markets. The examples given in the report show how emotions and psychological experiences can influence investment decisions; how a rule of thumb can lead to incorrect beliefs; and how a partial assessment of information can lead to a different decision than a complete assessment.
The report finds that individuals tend to make different decisions when interacting with an online interface as opposed to interacting with a human or relying on print materials. view the IOSCO The Application of Behavioural Insights to Retail Investor Protection Final Report
Source: IOSCO
Bitcoin surges as cryptocurrency market suddenly springs to life
Source: FIN24
WTO Global trade growth loses momentum as trade tensions persist
World trade will continue to face strong headwinds in 2019 and 2020 after growing more slowly than expected in 2018 due to rising trade tensions and increased economic uncertainty.
Main points:
Trade growth should pick up to 3.0% in 2020 with GDP growth steady at 2.6%.
Trade growth in 2020 is expected to out-pace GDP growth due to faster GDP growth in developing economies.
Trade tensions still pose the greatest risk to the forecast, but a relaxation could provide some upside potential. Weak import demand in Europe and Asia dampened global trade volume growth in 2018 due to the large share of these regions in world trade.
The value of merchandise trade was up 10% to US$ 19.48 trillion in 2018, partly due to higher energy prices.
Source: WTO
Biggest banks lead the switch to blockchain
The Swiss bank polled 82 individuals during Q1 of 2019 from banks that are either evaluating, piloting, or implementing blockchain. The most common use cases of blockchain are payments, trade finance, securities settlement as well as fraud detection and security.
Last month, Commerzbank and Deutsche Börse announced they had used distributed ledger technology (DLT) to execute a legally binding settlement of a repo transaction. In February, a report from IHS Markit suggested that blockchain technology could save investment firms US$12 billion in clearing and settlement fees.
Source: ctmfile.com
IMF-World Economic Outlook, Analytical Chapters, April 2019
(2) the increase has been fairly widespread across advanced economies and industries, but within them, it has been concentrated among a small fraction of dynamic—more productive and innovative—firms; and (3) although the overall macroeconomic implications have been modest so far, further increases in the market power of these already-powerful firms could weaken investment, deter innovation, reduce labor income shares, and make it more difficult for monetary policy to stabilize output. Chapter 3-The Price of Capital Goods: A Driver of Investment Under Threat?: view the IMF WEO Analytical Chapter 3:The Price of Capital Goods: A Driver of Investment Under Threat? Chapter 4: Drivers of Bilateral Trade and Spillovers from Tariffs view the IMF WEO Analytical Chapter 4: Drivers of Bilateral Trade and Spillovers from Tariffs
Source: IMF
April 4, 2019--Holdings in global gold-backed ETFs and similar products rose slightly in March by 3 tonnes(t) to 2,483t, equivalent to US$183mn in inflows. Global assets under management (AUM) fell by 1.6% in US dollars to US$103bn over the month, driven by the 2% decline in the price of gold during the same period.
North American funds had inflows of 2.5t (US$104mn, 0.2% AUM)
Holdings in European funds rose fractionally by 0.3t (US$53mn, 0.1%)
Funds listed in Asia also increased slightly by 0.3t (US$17mn, 0.5%)**
Other regions were virtually flat, rising by 0.2t (US$9mn, 0.7%)
April 3, 2019--New IMF research finds that macroeconomic factors, not tariffs, explain most of the changes in trade balances between two countries.
Bilateral trade balances (the difference in the value of exports and imports between two countries) have come under scrutiny recently.
April 2, 2019--The Board of the International Organization of Securities Commissions today published a report on behavioural insights that seeks to help its members improve the effectiveness of retail investor protection.
The report, The Application of Behavioural Insights to Retail Investor Protection, provides guidance to help regulators better understand the behaviour of retail investors in making financial investment decisions.
April 2, 2019--Bitcoin climbed suddenly on Tuesday to the highest level since November, leading a surge in virtual currencies and ending three months of calm in the $160 billion market.
April 2, 2019--WTO economists expect merchandise trade volume growth to fall to 2.6% in 2019-down from 3.0% in 2018. Trade growth could then rebound to 3.0% in 2020; however, this is dependent on an easing of trade tensions.
World merchandise trade volume is forecast to grow 2.6% in 2019, accompanied by GDP growth of 2.6%.
April 2, 2019--The world's largest globally systemically Important Banks (G-SIBs) are swiftly integrating blockchain technology into their operations ahead of their smaller rivals according to data released by UBS.
April 3, 2019--Chapter 2: The Rise of Corporate Market Power and Its Macroeconomic Effects
This chapter investigates whether corporate market power has increased and, if so, what the macroeconomic implications are. The three main takeaways from a broad analysis of cross-country firm-level patterns are that (1) market power has increased moderately across advanced economies, as indicated by firms' price markups over marginal costs rising by close to 8 percent since 2000, but not in emerging market economies;
Over the past three decades, the price of machinery and equipment has fallen dramatically relative to other prices in advanced and emerging market and developing economies alike. Could rising trade tensions, a slowing pace of trade integration, and sluggish productivity growth threaten this potential driver of investment going forward? This chapter sets out to answer this question by documenting key patterns in the price of capital goods, its drivers, and its impact on real investment rates.
The presence of large and rising bilateral trade balances has raised concerns that asymmetric obstacles to trade may distort the international trade system. This chapter examines the drivers of bilateral trade balances, distinguishing between the roles of macroeconomic factors, the international division of labor, and bilateral tariffs. It also examines how, through their impact on the ways production is organized within and across countries, tariffs affect productivity, output, and employment.
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