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Strong dollar puts pressure on commodities

Commodity prices have suffered since the middle of October, with the Bloomberg Commodities Index underperforming equities by a sizeable margin. The strong appreciation of the US dollar weighed heavily on prices, as markets brought forward their expectation of the first Fed rate hike to December. Rate rise expectations have hit precious metals particularly hard, while markets’ focus on the negatives in news from China has weighed on industrial commodities.

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