Information key to price formation on futures markets: IOSCO report
Studies by various agencies (organizations, central banks, regulators, etc) worldwide following public concerns over the rising commodity prices before July 2008 (e.g. crude oil) ascribe the phenomenon to economic fundamentals, rather than to the speculative activity that happened in the commodity markets. The IOSCO Task Force on Commodity Futures Markets, looking into the issue, emphasizes a good, transparent flow of information into the markets as the key to understanding the role of speculative and commercial activity in commodity futures markets and trading activities in, and the structure of, the underlying markets that may affect price discovery on futures markets. The Task Force offered several proposals to improve the quality and availability of fundamental commodity information, including promotion of transparency in the physical market.
Full report by the IOSCO Task Force on ‘Commodity Futures Markets’
Full report by the ADHEC Risk and Asset Management Research Centre on ‘Role of Speculation in Oil Prices’
Studies by various agencies (organizations, central banks, regulators, etc) worldwide following public concerns over the rising commodity prices before July 2008 (e.g. crude oil) ascribe the phenomenon to economic fundamentals, rather than to the speculative activity that happened in the commodity markets. The IOSCO Task Force on Commodity Futures Markets, looking into the issue, emphasizes a good, transparent flow of information into the markets as the key to understanding the role of speculative and commercial activity in commodity futures markets and trading activities in, and the structure of, the underlying markets that may affect price discovery on futures markets. The Task Force offered several proposals to improve the quality and availability of fundamental commodity information, including promotion of transparency in the physical market.
Full report by the IOSCO Task Force on ‘Commodity Futures Markets’
Full report by the ADHEC Risk and Asset Management Research Centre on ‘Role of Speculation in Oil Prices’
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2 comments:
Time and again various studies proved that its the fundamentals that drives the prices of commodities rather than speculators. I will request the people to go through both these report who ignorantly blame the price rise as irrational exuberence.
In the report "Role of Speculation in Oil Prices" page no 32 Role of Currency and Store-of-Value... is worth reading to understand that weakening dollar caused prices of crude to rise, whereas it was stable when priced in euro and far much better when priced in gold value.
Does it mean countries will move away from pricing their commodities away from dollar?
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