In today’s briefing:
- Elevated Commodity Prices and Stagflation: Nuanced Conditions in Play Across Different Markets
Elevated Commodity Prices and Stagflation: Nuanced Conditions in Play Across Different Markets
- Commodity prices are sensitive to monetary conditions and their upward movement after aggressive easing by the Fed from early-2020 should not have been a surprise.
- Tight oil inventories helped to underpin rising oil prices in 2021, but gradual supply increases from OPEC + and the US should alleviate supply-demand imbalances.
- Commodity prices should cool as the gap between aggregate demand and supply dissipates. ESG interests could still produce higher inflation by limiting the flow of capital to traditional commodity sources.
Before it’s here, it’s on Smartkarma
