Sharp fall in commodity prices

Whilst the media’s attention has been focused on the turmoil in the global financial markets, one of the key developments in recent weeks has been the steep decline in the prices of a basket of commodities as measured by the Economist Commodity Price Index. Palladium is down as world car manufacturing starts to contract, the global price of wheat has halved since April, oil prices have declined although steel prices continue to surge higher.

The fall in commodity prices will provide welcome relief for countries suffering from the prospect of stagflation but will also impact on many developing countries whose terms of trade improved sharply when the recent surge in prices took hold.

The links between commodity prices and real economic cycles are well established. But how are commodity values affected by persistent news of financial distress in the money and capital markets?

I have put a selection of price charts into this word file

Commodity_Price_Charts.doc

Investment in Energy Infrastructure [23 May 2012]
Unit 2 Macro: Cyclical and Structural Economic Issues Facing the UK [23 May 2012]
Unit 3 Micro: Game Theory and Business Economics [21 May 2012]
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Q&A: What do we need to know about output gaps? [20 May 2012]
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Tullow Oil and African Development [25 Apr 2012]
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Life in the Slow Lane - UK Growth in 2011 Lags the Euro Area [28 Mar 2012]
George Buckley at the Millfield Economics Society [28 Mar 2012]
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Pasty Prices - Something to Chew Over [19 Nov 2011]
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Can the “invisible hand” solve Africa’s poverty? [13 Oct 2011]
Unit 1 Micro: Producing Coffee - Kenya in Pictures [4 Oct 2011]
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Monetary Policy Roundtable [25 Jul 2011]
Unit 1 Micro: Cotton Prices and the Retail Price of Clothing [13 Jul 2011]
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Zondle Game: 10 Question Quiz about OPEC [11 Jul 2011]
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UK Economy Update: What Mervyn Said [11 May 2011]

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