AUSTRALIA - Barclays Capital has launched an index in a bid to provide a solution for obtaining liquid inflation exposure in markets where access to inflation-linked instruments is illiquid or non-existent.
It said the product was based on a proprietary model that dynamically replicates inflation measures of a target country at various horizons, using a combination of liquid inflation swaps from the US, UK and EUR, achieving high correlations.
The optimised weights are then applied to the Barclays Capital US, UK and EUR Inflation Swap Indices, resulting in an inflation swap index for the illiquid target country, it added.
Inflation-Linked and Fixed Income Index Derivatives product manager Ralph Segreti said: "The INSPIRE Index framework provides a cost-efficient solution to investors wanting to gain exposure or hedge against Australian inflation."
PTL has appointed Karein Davie as a client director in its Birmingham office.
The level of interest rate hedging increased to £29.5bn of liabilities in the second quarter as pension funds continued to de-risk, according to BMO Global Asset Management's research.
UK inflation has risen for the first time since November to 2.5% in July, up from 2.4% in June, thanks to rising fuel costs and the price of computer games.
The number of DB pension scheme trustees targeting a buyout with an insurer has increased significantly in the past five years, latest research from Willis Towers Watson shows.