Commodity Prices on the Move
Chart of the Week 29 Jul, 2010
May and June provided significant challenges for equity and commodity markets – weighed down by fears of a double dip recession, slow economic growth in the U.S., sovereign debt issues in Europe (and associated implementation of austerity measures), and measures by the Chinese government to deflate its property bubble.
However, during July we have experienced improvement in sentiment, fuelled by a series of positive indicators. These included strong manufacturing and confidence data out of Germany, improvement in U.S. housing sales and positive rhetoric from China on economic conditions.
Accordingly, we have witnessed a return of investors to the commodity space – as illustrated below in a chart of the LMEX, which tracks the price performance of the major base metals traded on the LME:
Source: LME, SR
