The Institute of International Finance is the global association of the financial industry, with close to 450 members from 70 countries. Its mission is to support the financial industry in the prudent management of risks; to develop sound industry practices; and to advocate for regulatory, financial and economic policies that are in the broad interests of its members and foster global financial stability and sustainable economic growth. IIF members include commercial and investment banks, asset managers, insurance companies, sovereign wealth funds, hedge funds, central banks and development banks.
Last year we saw the Fed as a neutral force for markets, because continued further hikes were adequately priced and there was little sign of the Fed being behind the curve. Since then not much has changed in the macro landscape, but markets have shifted to price an end to the hiking cycle. In effect, the Fed has become a casualty of the trade war and further tightening (which we expect) is now harder.
Global debt has grown by over 12% (or $27 trillion) since 2016, reaching $244 trillion (318% of GDP) in Q3 2018.
Dichotomy between still-strong growth and market warning signals leaves investors scrambling; Upward pressure on overnight rates could trigger liquidity shortages, higher volatility in money markets; Lowest tier of investment grade now accounts for 42% of the U.S. corporate debt universe, up from 30% in 2008; Central bank reserve managers shift away from USD in 2018
Christopher Kiew-Smith of the Abu Dhabi Global Market joins FRT to discuss the Global Financial Innovation Network (GFIN), an initiative by the ADGM and 11 other regulatory agencies to build a framework to share information and trial cross-border innovative solutions in the financial industry.
Not much has changed in the macro landscape, but markets have shifted to price an end to the hiking cycle. In effect, the Fed has become a casualty of the trade war, and further tightening (which we expect) is now harder.
Turkey and Argentina saw sharp depreciations in 2018, that erased substantial real exchange rate overvaluations. We assess the BoP impact in 2019 using our Nowcast.
On January 7, 2019, the IIF Senior Accounting Group (SAG) submitted to the International Accounting Standards Board (IASB) its comments on the Discussion Paper on Financial Instruments with Characteristics of Equity.
Our January 2019 US Financial Regulatory Update covers new reports released by the Federal Reserve on Financial Stability, and Supervision and Regulation; proposed adoption of SA-CCR for large banks; proposed regulations on GILTI Inclusion and BEAT Tax; the November 2018 U.S. General Election and other federal personnel updates, among other topics.
In this forerunner to deeper IIF analysis that will follow in 2019, we look at some potential scenarios where innovative disruption could have an asymmetric effect on banks’ balance sheets.
China is seeing the rise of a new kind of conglomerate, companies that occupy unprecedented roles in the world's second largest economy. With business
Expect Turkey's current account to be in surplus next year because of compressed imports. Nonresident outflows from banks will continue, albeit at a lower pace. External vulnerability won’t be the most pressing issue. The output cost of sharp external adjustment will be in focus.
Global non-financial corporate debt hit a record high of 92% in Q3 2018.
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