Fundamental factors, not speculation, were more likely to have caused last year’s price spikes in commodities, according to the result of an inquiry by the International Organization of Securities Commissions – but markets still need to be more transparent and better supervised.
The technical committee of Iosco – the association of 191 national securities regulators – commissioned a Task Force on Commodity Futures Markets in October to investigate concerns around the price rises and volatility in agricultural and energy commodities in 2008, and to find out whether regulators were supervising futures markets in the right way.
The Commodity Futures Trading Commission in the US, for example, had been criticised for failing to stop the price rises, and was accused of a whitewash when its inquiries found that fundamental market pressure, not speculation, had caused the inflation.
The Iosco committee’s report said futures regulators should have more access to...