Commodity prices generally fell this week, dragged down by a surging dollar and data that showed China’s economy struggled in July. Asia LNG and EU natural gas prices were the exception, rising as the spectre of strikes at several LNG facilities in Australia continued to loom large.
Next week, policymakers in China are likely to cut the Loan Prime Rate on Monday but this is probably priced into commodity markets. Prices will only get a meaningful boost if fiscal stimulus is announced. Elsewhere, August flash manufacturing and services PMIs for developed economies will be released on Wednesday. A particularly strong reading in the US could give the dollar a boost, but it is Fed Chair Jerome Powell’s speech at Jackson Hole next week that is more likely to move currency markets. We don’t expect a hawkish tone, which may give commodity prices a lift on the back of a softer dollar.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services