Moreover, though their presence in commodity markets is as yet limited, increasingly complicated products such as short ETFs and leveraged ETFs may also pose substantial risks with respect to counterparty, liquidity, and collateral management when they become popular. To develop emerging economies’ financial markets Finally, I would like to highlight the urgent need to develop and expand financial markets in rapidly growing economies.
As I mentioned earlier, commodity markets seem to be serving to some extent as a proxy for investments in rapidly growing emerging market economies. This tendency may be stronger when monetary conditions are globally accommodative and financial investors’ appetite for portfolio rebalancing and carry trades is growing.