Rep. Waters plans to slow bank deregulation | UK Brexit secretary resigns after Cabinet backs deal | Watchdogs: Commodity traders' use of middlemen needs scrutiny
November 15, 2018
Commodities Insight SmartBrief
Regulatory insight and top news for commodities markets
Regulatory & Compliance
Rep. Waters plans to slow bank deregulation
Rep. Waters plans to slow bank deregulation
Waters (Paul Morigi/Getty Images)
Rep. Maxine Waters, D-Calif., said that when she becomes chairwoman of the House Financial Services Committee, she will rein in easing of banking regulation. "Make no mistake, come January, in this committee the days of this committee weakening regulations and putting our economy once again at risk of another financial crisis will come to an end," Waters said.
CNBC (11/14),  FX Empire (Israel) (11/14) 
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UK Brexit secretary resigns after Cabinet backs deal
After a five-hour meeting, the UK Cabinet has decided to support a draft agreement governing the UK's relationship with the EU after Brexit, setting up Prime Minister Theresa May for the next hurdle: Parliament, where the deal faces opposition from within her party. Brexit Secretary Dominic Raab has resigned in opposition.
Bloomberg (tiered subscription model) (11/15),  The Guardian (London) (11/15),  Politico (11/15),  Deutsche Welle (Germany) (11/15) 
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Watchdogs: Commodity traders' use of middlemen needs scrutiny
Public watchdogs Global Witness and Public Eye are pushing regulators for more scrutiny of the use of middlemen by large commodity traders, in an effort to stem corruption.
Financial Times (subscription required) (11/14) 
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Giancarlo to push ahead with SEF proposal
Commodity Futures Trading Commission Chairman J. Christopher Giancarlo will press for adoption of a proposal that would give swap execution facilities more flexibility in trade execution, despite opposition from two Democratic commissioners. "I will work with all my commissioners, Republican or Democrat, as much as I can, but I also intend to move forward," he said.
MLex (subscription required) (11/14) 
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ESMA's proposed swaps amendments too narrow, experts say
The European Securities and Markets Authority's proposed amendments to the European Market Infrastructure Regulation to help shift noncleared swaps from London to the European Union may be too narrow to overcome the hurdles of a post-Brexit mass swaps migration, experts say.
Risk (subscription required) (11/9) 
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Industry bodies oppose changes to equivalence regime
Industry associations, including FIA, are opposing the European Commission's proposed changes to the equivalence regime under Europe's revised Markets in Financial Instruments Directive as too restrictive to third-country investment services. "Limiting the ties between EU and non-EU market participants would be a backwards step for EU capital markets and their connection to the world," noted the statement.
Futures & Options World (subscription required) (11/9) 
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Hot Topics
Special Coverage from CME Group's Global Financial Leadership Conference
Citadel's Griffin talks Fed independence, finance talent
Citadel's Griffin talks Fed independence, finance talent
The president's criticism of the Federal Reserve's monetary policy could harm the dollar, Ken Griffin of Citadel Investment Group said at the Global Financial Leadership Conference. "The concept that our central bank is independent from partisan politics is extraordinarily important to the stature of our currency in global markets and to the faith and confidence people have in the value of the dollar both domestically and abroad," he said.
SmartBrief/Finance (11/14),  MarketWatch (11/13) 
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CME Group's Duffy: Trade deficits can have benefits for US
The absence of upcoming elections allows China to be more patient than the US in trade talks between the two countries, and the US will "have to capitulate to some extent," CME Group CEO Terry Duffy said. "Trade deficits are not the worst thing" because they allow the US to be a "thought leader for the rest of the world because the rest of the people around the table are now clients of the United States," he said.
CNBC (11/13) 
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Macro risks lead Campbell & Co. to short global stocks, exec says
Mike Harris of Campbell & Co. said his firm went short on global stocks in the latter half of October because of macro risks, particularly US-China trade tensions. "You can't underweight the importance of whether or not the Trump administration [and] House Democrats will be able to get infrastructure done, get tax 2.0 done -- or will we have a lame duck for the next two years?" he said.
CNBC (11/13) 
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This Week in Commodities
US oil, gas production grows despite fewer wells
US oil and natural gas output climbed from 2014 levels to 9.3 million barrels per day and 83.4 billion cubic feet per day, respectively, in 2017, even as the well count dropped from a peak of 1.03 million wells in 2014 to 991,000 last year, reports the Energy Information Administration. The US is projected to account for half of global oil and gas output growth by 2025.
The Wall Street Journal (tiered subscription model) (11/12),  U.S. Energy Information Administration (11/14) 
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Exporter Argentina now importing US soybeans
Major soybean exporter Argentina is now importing the crop as it responds to Chinese demand from non-US suppliers. It's a result of US-China trade tensions, low yields in Argentina and low prices for US beans.
Bloomberg (tiered subscription model) (11/14) 
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Oil's long slide may flag wider problems
Last week marked the longest downward stretch for oil prices since 1984. The market for crude is now in a bear phase and may be signaling a downturn in the global economy and other commodity markets.
The Wall Street Journal (tiered subscription model) (11/12) 
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Chillier winter signals rising gas prices
The weather outlook is suddenly more frigid, raising the prospect of rising prices for natural gas over the heating season. Low stockpiles are another factor.
The Wall Street Journal (tiered subscription model) (11/14) 
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Commodities' flat performance a possible harbinger
Several commodities -- including oil, copper and platinum -- failed to follow the recent stock market rebound, possibly signaling slower economic growth. Factors weighing on these markets include a strong dollar, rising interest rates and trade tensions.
CNBC (11/9) 
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Copper hammered in a string of down days
Last week was a downer for copper, with prices sliding four out of five trading days in line with a wider slump across other commodities.
The Wall Street Journal (tiered subscription model) (11/9) 
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China on course to top EU for LNG imports
China passed South Korea as an importer of liquefied natural gas last year and is now on pace to surpass the European Union by 2040 and claim the world title, according to the International Energy Agency. In its World Energy Outlook, the IEA also notes the global gas trade is growing at a 2.3% annual clip.
Bloomberg Professional Services (11/13) 
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OPEC, non-OPEC nations target production cuts
Seeking a new direction in strategy, the OPEC and non-OPEC Joint Ministerial Monitoring Committee is looking at ways to cut production beginning in the new year. The panel noted that growing oil supplies are expected to exceed demand in 2019 as global growth slows.
Argus Media (11/11),  Financial Times (subscription required) (11/12) 
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CME Group Insights
How will trade dispute with China play out in commodities?
By any measure, China's growth pace in the third quarter slowed only slightly, evidencing little effect so far from the trade dispute with the US. So far, that's good news for commodities, writes CME Group Senior Economist Erik Norland, but longer-term measures by Beijing to counter the trade effects may cut both ways, with the prospect of yuan devaluation the most ominous prospect.
CME Group (11/8) 
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Giancarlo on mission toward CFTC digitalization
Giancarlo on mission toward CFTC digitalization
Commodity Futures Trading Commission Chairman J. Christopher Giancarlo is pushing the agency toward digitalization "to keep pace with the pace of markets." The CFTC needs "to take an 80-year-old statute and a 40-year-old agency and reform it for this new digital marketplace we are in, and it begins with understanding these changes," Giancarlo says.
OpenMarkets (11/13) 
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Editor's Note
Commodities Insight SmartBrief will publish next Wednesday
In observance of the Thanksgiving holiday, Commodities Insight SmartBrief will not publish Thursday, Nov. 22. Next week's edition will publish on Wednesday, Nov. 21.
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Selfless service has always been one of the most powerful methods of influence.
Stephen Covey,
writer and educator
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