October 2, 2014

Capital flows to emerging markets have continued to be very choppy this year according to the latest Capital Flows Report by the Institute of International Finance. The period from March to July was marked by a surge in portfolio equity and debt inflows, particularly to Asia, followed by a sharp slowdown since August.

The IIF has raised its 2014 forecast for total private capital inflows to emerging markets by $130 billion to $1,162 billion. This is a decline from $1,241 billion in 2013, primarily due to the collapse of flows to Russia.

October 1, 2014

The Institute of International Finance today announced that Andrés Portilla has been promoted to Managing Director for Regulatory Affairs.

“Regulatory issues remain our top priority and I am pleased Andres will lead our advocacy efforts on behalf of our members,” said Tim Adams, president and CEO of the IIF. “Andrés’ experience and knowledge of these complex issues will allow us to work with our members and the regulatory community toward our common goal of a safe and sound financial system that promotes economic growth and job creation.”

September 30, 2014

Normalization of U.S. monetary policy will test the notion that the market calm and low volatility environment that has reigned over financial markets in recent years is but an “illusion of liquidity,” created by and dependent on near-zero interest rates and will be reversed when rates rise, according to the latest IIF Capital Markets Monitor.

September 29, 2014

Portfolio inflows to emerging markets climbed to a moderate level in September after a sharp slowdown in August, according to the latest EM Portfolio Flows Tracker by the Institute of International Finance.

Emerging markets received $18 billion in September, up from the $12 billion in August (revised up by $3 billion). Portfolio equity inflows slowed marginally to $8 billion, while portfolio debt inflows picked up to $10 billion.

September 18, 2014

In an opinion piece featured in the Australian Financial Review ahead of the G20 Financial Ministers and Central Bank Governors meeting in Cairns, IIF President and CEO Tim Adams addresses how steps have been taken to put in place resolution regimes to ensure that a financial institution can fail without disruption to the financial system. Adams highlights how Financial Stability Board’s Key Attributed of Effective Resolution Regimes for Financial Institutions set out a global model that most jurisdictions have turned into law. “We now have the tools to handle a failed bank—without cost to taxpayers…” Adams wrote.

September 18, 2014

The Institute of International Finance today released a paper arguing that, in the relatively near future, regulators and the industry will be able to say without reservation that no financial institution is “too big to fail.”

“The global financial system is safer and sounder than it was six years ago,” said Tim Adams, president and CEO of the IIF. “In 2008, there was no plan for what to do if a big bank failed. Today, we have agreed international principles. Legislatures have enacted these principles into law. Detailed roadmaps have been prepared to apply the new laws on a bank by bank basis, and lines of communication have been established among authorities to ensure a global bank can be resolved cross-border.” 

September 15, 2014

The Institute of International Finance released its latest assessment of the global economy, raising concerns that growth momentum has been faltering.

The IIF noted that global growth picked up only marginally in the second quarter as stronger U.S. and Chinese growth were largely offset by disappointments elsewhere. Slower momentum in mature economies outside the U.S., notably the Euro Area, is weighing on global trade and exacerbating home-made problems in many emerging markets.

September 9, 2014

Emerging market GDP growth is on track to grow at a 3.9 percent pace in 2014Q3, slightly higher than the 3.5 percent seen in 2014H1 according to the August reading of the Institute of International Finance’s new Emerging Market Coincident Indicator (EMCI).

“Growth in emerging markets is gradually recovering from a dismal first half performance,” said Charles Collyns, chief economist at the IIF. “However, the pace of growth is still modest, in part reflecting drag from some mature economies, notably the Euro Area, but also home-grown difficulties including political uncertainty in a number of emerging markets.”

September 4, 2014

Investors should be more cautious as market uncertainty rises in anticipation of the Fed’s first rate hike next year, according to a new index developed by the Institute of International Finance.

“In light of the pending Fed exit from quantitative easing and the associated potential market risks we are offering a simple, intuitive gauge that we think is a helpful alternative to the VIX,” said Hung Tran, executive managing director at the IIF. “Currently, the IIF U.S. Market Risk Index reflects a degree of stress building up: equities continue to gain over bonds, while the dollar index has had a decisive move higher since early July. Hence while volatility-based risk measures still show a green light, our new index suggests more caution may be warranted.”

August 27, 2014

Following several months of buoyant inflows, portfolio investments in emerging markets slowed sharply in August, according to the latest Institute of International Finance EM Portfolio Flows Tracker.

Emerging markets are estimated to have received a mere $9 billion in August, after an average of $38 billion per month in May-July. Portfolio debt inflows were particularly affected, grinding to a halt in August.

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Dylan Riddle

Tel: +1 202.857.3626

Email: driddle@iif.com