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China's imports of industrial commodities dropped sharply in the second quarter, indeed by more than they did during the global recession. Imports may well rebound in the second half of the year, but the recent weakness is a useful reminder that buoyant …
12th July 2011
Today's weak employment report should go some way towards dashing the renewed optimism about the US economy which, combined with reduced fears of an imminent Greek default, had propped up commodity prices earlier this month . … US demand likely to …
9th July 2011
Changes in supply and in the demand from consumers can only explain part of the recent swings in commodity prices, with the rest largely due to speculation. What’s more, speculation can affect prices over both short and longer periods, and in both spot …
8th July 2011
The time of the year is fast approaching when the price of gold is traditionally assumed to be boosted by a seasonal pick-up in demand. We are sceptical that calendar effects can ever be that significant, but we do expect the gold price to rise further …
6th July 2011
Commodity prices continued to fall in June. But while concerns about demand were the main driver in May, last month saw attention shift to the prospects for supply. This explains the divergence between the prices of industrial metals, which generally held …
5th July 2011
The decline in China’s imports of industrial metals may partly reflect a drawdown of inventories, but underlying demand also appears to have weakened and shows no sign of rebounding. … Can China’s destocking alone explain lower metals …
30th June 2011
Oil prices have probably overreacted to the International Energy Agency’s (IEA’s) decision to release emergency stockpiles, just as they overreacted (in the opposite direction) to OPEC’s decision to leave production quotas unchanged earlier this month. …
25th June 2011
The continued deceleration in China’s economy signalled by the flash PMI for June supports our view that commodity prices – industrial metals in particular – have further to fall. There is plenty of evidence of weakness in other regions too. … Chinese …
24th June 2011
Similar to many other agricultural commodities, supply problems have caused the price of coffee to more than double since the start of 2010. However, there is a clear uptrend in coffee consumption too, which should continue to support prices even as …
22nd June 2011
We expect slowing industrial demand, especially from the automotive sector, to cause the price of platinum to slide from around $1,800 per ounce to a low of $1,500 in 2012. Palladium may be better supported in the short-term by developments in China, by …
16th June 2011
China’s imports of many key commodities edged up in May compared to April, but they remain below their average level in the first quarter. Imports of copper in particularly have fallen sharply this year. … China's Imports of Commodities …
11th June 2011
Despite receding fears of inflation we believe the price of gold will continue to climb, chiefly spurred by worries about the health of the global economy and sovereign debt. We think gold remains on track to rise from around $1,535 per ounce to $2,000 in …
9th June 2011
OPEC’s decision to maintain its current output quotas, rather than raise them, will disappoint many after the encouraging signals from Gulf delegates in the last 24 hours. However, oil production is already well above the formal ceiling, and some members, …
8th June 2011
The UN’s assessment that agricultural commodity prices are likely to remain “high and volatile” for the rest of this year and into 2012 is perfectly reasonable. However, even if food prices do stay near their current highs, the impact on inflation will …
7th June 2011
The dark cloud over the US economy has had a small silver lining for commodity prices in the form of renewed expectations of yet another bout of quantitative easing from the Fed and a lower dollar. However, we think it is far too soon to expect QE3. …
6th June 2011
Major Gulf oil producers such as Saudi Arabia now need higher prices to balance their government’s books, but these break-even rates are unlikely to act as a significant constraint on how far or quickly prices can fall. Whether OPEC lifts output quotas at …
2nd June 2011
Most commodity prices tumbled last month as doubts about the strength of global demand and even the Chinese economy grew. We believe these falls were fully justified by fundamentals and expect further declines in the months ahead, gold and (perhaps) …
1st June 2011
Despite this week’s partial recovery, we continue to expect the price of a barrel of Brent crude to drop back below $90 by the end of the year, as global demand slows, the Middle East risk premium fades, and the dollar rebounds. This would mean a $25 drop …
27th May 2011
The steady deceleration in China’s economy signalled by the flash PMI today supports our view that the current weakness of commodity prices – industrial metals in particular – is fully consistent with the fundamentals. … China Flash PMI …
23rd May 2011
The conclusion of the Fed’s second round of Treasury purchases may remove one reason for commodity prices to rise but it is not necessarily a good reason for them to fall. However, there are many other reasons to expect the prices of many commodities to …
19th May 2011
Expectations that buoyant Chinese demand will drive commodity prices ever higher have been looking increasingly shaky. For a start, China’s imports of many key commodities have actually been falling in recent months, partly due to a cyclical downturn. But …
17th May 2011
The price of aluminium has already fallen by around 7% this month, from the cyclical high of nearly $2,800 to around $2,600 per tonne, as part of the global commodity rout. We expect further substantial falls, perhaps taking prices back below $2,000 over …
12th May 2011
Last week’s rout in commodity prices may have been exaggerated by special factors but the falls were mostly consistent with our view of the economic fundamentals. Rather than being in the early stages of a super-cycle, the prices of many industrial and …
11th May 2011
This week’s sharp falls in commodity prices of all types may have been exaggerated by wild speculation but are mostly consistent with our view of the economic fundamentals. … Risks shifting to the …
4th May 2011
