By Anadolu Agency
October 17, 2022 7:05 amISTANBUL
Although the commodity market occasionally saw a positive course on a weekly basis, the long-standing selling pressure continued last week as well.
Increasing geopolitical risks, ongoing pandemic measures in China, inflationary concerns related to the energy crisis and raising recession expectations due to central banks’ hawkish stance have had an impact on markets.
The more-than-expected annual inflation rate of 8.2% in the US announced on Thursday increased the possibility of a 75-basis-point interest rate hike from the Fed. Markets also see a 100-basis-point hike possible.
Analysts said concerns that the high inflation will slow down economic activities and decrease demand continue to have severe effects on markets.
Last week, gold lost 3%, silver and palladium 9.3%, and platinum 1.8%.
Copper and lead increased by 0.9% and 1.4%, while nickel, zinc and aluminum decreased by 4.2%, 1.6% and 0.6%, respectively.
Despite a sanction decision from the US on Russian aluminum, low demand expectations due to high energy prices decreased aluminum prices.
The price of Brent oil dropped 7.2% last week, while natural gas prices lowered by 4.4%.
News that Chinese economic activity slowed down had a negative impact on oil prices.
OPEC lowered its forecast for the global oil demand. The forecast for the increase in the crude oil stocks of the US also suppressed prices.
Agriculture market
Wheat and rice prices dropped by 2.2% and 0.5% last week, respectively, while corn and soybean saw increases with 1.1% and 1.2%.
Sugar prices increased by 0.8%, while coffee lost 9.5% and cocoa 1%.
Zafer Ergezen, a commodity expert, said the more-than-expected US inflation figures caused selling pressure in commodities.
It is expected that central banks will continue to increase policy due to high inflation, he added.
Stating that coffee closed the week with a value loss, Ergezen said production expectations strengthened with rains and this situation caused selling pressure in coffee.
Touching on higher sugar prices, he said Brazil’s sugar production dropped by 12% on a yearly basis, causing supply concerns.
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