Gold 1784,785
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EURUSD 1,2134
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DJIA 33812
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OIL.WTI 64,005
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DAX 15299,50
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The strong growth in bitcoin and US stock markets has somewhat overshadowed the current situation in commodity markets. For example, an index such as TRJCRB (Thomas Reuters/Jeffries Commodity Price Index) is showing its highest growth in 5 years, and is already set to go beyond the five-year highs.
OIL.WTI
What does this movement even mean? To make it clearer, the CRB index includes all the major commodities of world consumption. They are oil, orange juice, cotton, sugar, aluminium, gas, coffee, gold, silver, nickel, wheat and about ten other commodities. A rise in this index indicates that most of these commodities are increasing in value. From this we can conclude that global inflation is already beginning to accelerate around the world because if wheat increases, all the derivatives of this simple good, such as bread, fodder and alcohol, will also increase. Rising prices for basic commodities will drive up inflation across the board, and the people with low incomes, for whom the cost of food is critical for survival, will be the first to suffer.
How should we deal with this situation? It is accurate to say that if the prices of the bulk of commodities rise, the prices of the rest of the commodities will also rise.
In addition, there are signs of limited supply on the markets. There are supply cuts, export bans and many other food-related restrictions.
As a result, we see that even during a pandemic, when the whole world has limited consumption, demand is at very low levels. However, in parallel, we are seeing record rises in the prices of all the world’s major commodities. This can only mean that the pumping of huge amounts of money into the world economy is already in full swing and sets the stage for severe inflation in the near future.
If you trade commodities, commodities are likely to continue rising. It will also be a positive signal for those who trade in the stocks of companies that sell these commodities. Primarily crop companies, gold producers and oil producers.
11.00 EU consumer confidence in April
14.00 IFO Economic Expectations Index for Germany April
14.30 Harmonised German Consumer Price Index YTD
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