IOSCO has published the 2016 edition of its Securities Markets Risk Outlook report, identifying and examining key trends in global financial markets and the potential risks to financial stability.
The key trends are:
- interventions of central banks worldwide;
- falling commodity prices and uncertainty over global growth trends;
- general growth trends in corporate bond, equity and securitised product markets;
- recent trends in emerging market securities markets related to leverage, capital flows and market-based financing; and
- the increasing digitalisation of financial markets and potential for technological disruptors.
The four potential risk areas it examines in depth are:
- corporate bond market liquidity;
- risks associated with the use of collateral in financial transactions;
- harmful conduct in relation to retail financial products and services; and
- cyber threats.
The report also discusses issues around the asset management industry even though it is not seen as a risk area. (Source: IOSCO reports on risk in the securities market)