First Impressions

SEFCON V: One Year In – November 12, 2014, Grand Hyatt New York
JohnLothianNews.com
The Wholesale Markets Brokers’ Association, Americas (WMBAA) will host its fifth annual SEFCON event on November 12. Register Here

Watch the video promo and register to join dealers, traders, exchanges and regulators for this once-a-year look at the state of the SEF world.

Now that SEFs have been operational for a year, it is time to take a fresh look.

Watch the video »

Quote of the Day

“I’m worried about growth around the world right now. This is obviously a set of things that we have to think about in our own policies going forward.”

Fed Governor Daniel Tarullo in the story, “Fed Officials Say Slow World Growth Could Delay Rate Rise”.

Lead Stories

Bond funds worldwide attract $15.8 bln inflows over week
Reuters
Investors worldwide poured a net $15.8 billion into bond funds and $47 billion into money market funds in the week ended Oct. 8, data from a Bank of America Merrill Lynch Global Research report showed on Friday.
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‘Normal’ interest rates a distant dream for investors
Russ Koesterich – Financial Times
For more than a year, investors have nervously anticipated a rise in interest rates. They are still waiting.
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Fed Officials Say Slow World Growth Could Delay Rate Rise
Christopher Condon, Jeff Kearns and Ian Katz – Bloomberg
Federal Reserve policy makers said a slowdown in the world economy could undermine the U.S. expansion and prompt them to delay raising interest rates.
“If foreign growth is weaker than anticipated, the consequences for the U.S. economy could lead the Fed to remove accommodation more slowly than otherwise,” Vice Chairman Stanley Fischer said in a weekend speech at the International Monetary Fund’s annual meetings in Washington.
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Fund Traders Dig Deep for Bonds
Matt Wirz – WSJ
Weeks of persistence paid off for BlackRock Inc. bond trader Iseult “Izzy” Conlin in mid-August, when one of her computer screens flashed, flagging a $2 million block of SunTrust Banks Inc. bonds that had just gone on sale.
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Bond network Neptune faces large hurdles
Spencer Anderson – Reuters
Banks’ plans for a bond network to improve liquidity in the corporate debt market face significant hurdles beyond the technological challenges, including the vested interests of the market’s long-established players and dealers.
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Central Banks

ECB Clash Resumes as Draghi Spars With Weidmann on Stimulus
Stefan Riecher and Simon Kennedy – Bloomberg
Mario Draghi and Jens Weidmann are clashing anew over how much more stimulus the ailing euro-area economy needs from the European Central Bank.
As Europe’s woes again proved the chief concern at weekend meetings of the International Monetary Fund in Washington, President Draghi repeated he’s ready to expand the ECB’s balance sheet by as much as 1 trillion euros ($1.3 trillion) to beat back the threat of deflation. Bundesbank head Weidmann responded by saying that a target value isn’t set in stone.
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ECB Weighs First Step to Buying Yuan for Foreign Reserves
Stefan Riecher and Jeff Black – Bloomberg
The European Central Bank will discuss next week whether to begin laying the groundwork to add the Chinese yuan to its foreign-currency reserves, according to two people with knowledge of the matter.
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Draghi’s true alternatives
James Mackintosh – Financial Times
Mario Draghi has been very clear about what would push him into the full-blown QE of buying government bonds. He faces some serious opposition from German monetary conservatives even to the less whizzy QE he’s unveiled so far, though — that of buying asset-backed securities.
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ECB’s Draghi Sees No Eurozone Government Bond Market Bubble
Brian Blackstone – WSJ
European Central Bank President Mario Draghi said on Saturday that he sees no major risks of a bubble in eurozone government bond markets, suggesting he doesn’t expect instability to impede possible sovereign bond purchases by the ECB.
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Reserve Bank of India eases liquidity ratio requirements
Blake Evans-Pritchard – Risk.net
Central bank looks to relax India’s twin track liquidity rules in order to prevent an overlap between Basel III and onshore metrics
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Fed’s Tarullo: global downside risks are policy factor
Howard Schneider and Douwe Miedema – Reuters
Downside risks to the global economy are a factor the Federal Reserve will have to consider even as the U.S. economy recovers from the 2007-2009 financial crisis, Fed Governor Daniel Tarullo said on Saturday.
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Regulatory Work Underway And Lessons Learned – Remarks Given By Mark Carney, Governor Of The Bank Of England At The 29th Annual G30 International Banking Seminar, Washington D.C, 12 October 2014
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Currencies

State Street’s TruCross/FX Solution Now Live
State Street Global Markets today announced that its TruCross/FX platform is now live and available to institutional investment managers.
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Ruffer: The dollar can be a new defensive asset
Anna Fedorova – Investment Week
The managers of the Ruffer Investment Company are backing the US dollar to excel once again as an asset that can offset equity risk as global uncertainty continues.
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CFTC Aims to ‘Stay on Top’ of Bitcoin Developments
Profit & Loss
US regulators at the Commodity Futures Trading Commissioner tentatively acknowledged the potential long-term impact of Bitcoins on financial markets
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Indexes & Index Products

US ETF giant WisdomTree plans UK market debut
Dan Jones – Investment Weeks
WisdomTree, one of the largest passives providers in the US, is to launch its first ETFs in the UK by the end of the year as part of its push into Europe.
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US ETFs to take aim at China’s onshore bond market
www.cnbc.com
U.S. investment firms are readying the first line of exchange-traded funds designed to give American investors access to China’s swelling onshore bond market, which has been largely closed off to foreigners.
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Gold

Hedge Funds Miss Out on Gold Gains as Bull Holdings Drop
Lydia Mulvany – Bloomberg
Hedge funds reduced bullish gold wagers just before prices rallied the most since June on concern that global economic growth is weakening.
The net-long position in New York futures and options contracted for an eighth week, U.S. government data show. The International Monetary Fund cut its 2015 world growth forecast on Oct. 7. Minutes of the Federal Reserve’s last meeting showed policy makers saw slowing foreign expansion as a risk to the U.S., fueling bets that record-low borrowing costs will persist.
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Gold Futures Rise to Three-Week High as Dollar Declines
Laura Clarke and Joe Deaux – Bloomberg
Gold futures rose to the highest in three weeks as concern that the global economy is faltering stoked bets that the Federal Reserve will keep U.S. interest rates low, driving the dollar down.
Fed Vice Chairman Stanley Fischer said yesterday that weak growth outside the U.S. may prompt the central bank “to remove accommodation more slowly than otherwise.” Last week, gold jumped 2.4 percent, while the dollar fell against a basket of 10 currencies, ending the longest rally since June 2010.
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Twelve Firms Expressed Interest in Running Gold Fix Replacement
Nicholas Larkin – Bloomberg
At least 12 firms have expressed interest in running a replacement for the century-old gold fixing benchmark, the London Bullion Market Association said.
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Hedge Funds Miss Out on Gold Gains as Bull Holdings Drop
Lydia Mulvany – Bloomberg
Hedge funds reduced bullish gold wagers just before prices rallied the most since June on concern that global economic growth is weakening.
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Asian Market Hubs Move Into Gold Trading
BIMAN MUKHERJI in Hong Kong and ESE ERHEREINE in London – WSJ
Asians buy most of the world’s gold, but nearly all of it trades in London. Now, with Western investors souring on the metal, the region is making a bid for some of the action.
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