Cotton prices up 15.1%, rice 7.3%, cocoa 5.7%, sugar 5.1%, soybeans 4.4%, wheat 2.2%, and coffee 0.4%
Global commodity markets rallied last week to overcome a sustained slump.
In the financial markets, it is predicted that the Fed will increase interest rates by 50 basis points with a 65% probability and 75 basis points with a 35% probability in December.
While Chicago Fed President Charles Evans stated that it would be beneficial for the Fed to end interest rate hikes by 75 basis points, Boston Fed President Susan Collins stated that a 50-basis point increase was also considered a fairly large rate hike.
Richmond Fed President Thomas Barkin stated that interest rates may continue to rise for a longer period of time and the pace of tightening may slow down.
While the dollar index gave back most of its gains on Friday, ending the week with an increase of 0.1% at 110.8, commodity prices recorded a significant increase.
With these developments, gold increased by 2.2%, silver by 8.2% and platinum by 1.9% last week.
Metals rise on news that China will abandon its “zero COVID-19″policy; copper gained 5.2%, lead 5.2%, aluminum 4% and nickel 7.1%.
Energy commodities were also dominated by sharp rises; Brent oil rose 4.3% and natural gas traded on the New York Mercantile Exchange rose 13.6%.
The rise in Brent oil prices was influenced by the easing of concerns about global oil demand.
The forecast for the decline in crude oil stocks of the US, the world’s largest oil producer and consumer, caused an increase in prices with the perception that the demand in the country has strengthened.
Analysts said that natural gas prices are rising due to the winter season and expectations that demand for natural gas will continue for a long time.
Agricultural commodities also saw rapid increases last week; wheat traded on the Chicago Mercantile Exchange rose 2.2%, soybeans 4.4% and rice 7.3%.
Cotton gained 15.1%, coffee 0.4%, sugar 5.1% and cocoa 5.7%.
With the decrease in production estimates, an upward trend was observed in agricultural commodities, while wheat prices were also affected by geopolitical developments.
After Russia announced that it was suspending its participation in the Black Sea grain agreement, wheat rose 9% and then stabilized at around $8.4. The country later returned to the implementation of the deal.
Zafer Ergezen, a commodity markets expert, stated that the expectations that central banks will end interest rate hikes are effective in all markets.
The expectation that “the worst is over” with the Fed’s announcement of its interest rate decision was effective in purchases, Ergezen said, “Therefore, there was a retraction in the dollar index and a recovery in asset prices.”
Ergezen said that the recovery in oil prices increased corn prices.
Mentioning the rise in prices of rice, Ergezen noted that the decline in production began to be reflected in the prices, as rice exports increased.