News
Germany’s negative price rules bring negative consequences
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Germany's negative electricity price rules caused €50 million in losses for offshore wind projects in February 2020. In particular, the "six-hour rule" that stops support payments, if wholesale day-ahead electricity prices go negative for more than six hours. The aim is to ensure there is no incentive to generate electricity when supply exceeds demand.
Investors pull record €250 billion from European funds
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Investors fled mutual funds in Europe at the fastest rate on record in March when they redeemed €246bn. Bond funds across Europe were hit with redemptions of €140bn. Long-term index funds shed €28bn. On top of the investor outflows, Europe’s fund industry was hammered by falling markets that led to a nearly €1tn drop for long-term funds.
German Bunds post the longest losing streak in 2.5 years
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German government bonds have fallen for 7 consecutive days, taking their yield more than 60 basis points higher from a record low of -0.91%. It’s their longest run of losses in 2.5 years. “A move in 10-year bund yields back above zero is not sustainable but it is a very real possibility over the next week,” said Richard Kelly of Toronto-Dominion Bank.
Gold futures log largest weekly loss in more than 8 years
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Gold futures ended sharply lower for a fourth straight session on Friday, with a loss of more than 9% for the week. It seems that investors have been selling gold in order to cover losses elsewhere. Some investors who were reluctant to part with their equities at depressed prices were able to sell gold in order to meet the margin calls.
European electricity demand begins to notice the coronavirus effects
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The electricity futures prices for the next quarter still do not show symptoms of being affected by the coronavirus pandemic. From March 9 to 11, the prices increased in most European markets. The outlook for the electricity futures for 2021: the UK registered a rise of 0.1%, other markets registered declines of between 0.2% and 3.4%.
Cryptocurrencies see $94 billion wiped off value in 24 hours
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Bitcoin was down 48% from 24 hour. Over the past few years, bitcoin has been likened to “digital gold” and has been seen by some as a safe haven asset to park money when markets are facing turmoil. But bitcoin, which has now erased all of its gains for the year and is in negative territory, is behaving more like a risk asset such as an equity.
Pressure on the Royal Bank of Australia over digital currencies
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RBA is being encouraged to conduct trials involving issuance of a digital version of the Australian dollar, as dozens of global central banks seek to repel private sector crypto currencies such as Facebook's Libra. It has shifted the conversation and it is the private sector moving into the digital currency space that has got central banks' attention.
UK moves to require pension funds to disclose climate change plans
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British pension funds may soon need to explain how they are fighting climate change under a global framework as the United Kingdom aims to reach carbon neutrality by 2050. British pension funds managed some $2.8 trillion in assets in 2018, according to the Organization for Economic Co-operation and Development (OECD).
Why hedge fund managers say they avoid sustainable investing
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Sustainable investing is one of the fastest-growing areas in money management as pension plans and other large investors plow money into the strategy. About $30.7 trillion was held in sustainable or green investments in 2018. 63% of money managers cited a lack of quality and consistent sustainability data as the biggest challenge in making such decisions.
World’s pile of negative debt surges by the most since 2016
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The global rush for safer assets has fuelled a huge jump in the world’s stockpile of negative-yielding bonds. Last week brought the worldwide total to $12.4 trillion – the highest level in two months. The resurgence is a potent reminder that the market distortions synonymous with loose monetary policies have not gone away.
Banks head into darkest phase of the Nordic negative-rate
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The policy used to fight sudden pressure on the Danish krone has now shaped a whole decade, with most economists predicting years more of the regime in Denmark. Bankers’ association says negative rates pose a serious threat. It estimates that life below zero cost the industry around 2.5 billion kroner ($371 million) last year alone.
The rich have had enough of negative interest rates
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Swiss private bankers say that clients have asked to withdraw large amounts of cash. The moves follow five years of negative interest rates. The policy, intended to keep the Swiss franc from appreciating, requires banks to pay to park money with the Swiss National Bank. Banks have passed a portion of the extra costs on to their most affluent customers.
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