Falling Commodity Prices Raise Hopes That Inflation Has Peaked

By Ryan December
The Wall Street Journal
July 4, 2022
Category: Finance & Economics
Region: United States

A slide in all manner of raw-materials prices—corn, wheat, copper and more—is stirring hopes that a significant source of inflationary pressure might be starting to ease. …U.S. crude slipped from highs above $120 a barrel to end around $106. Wheat, corn and soybeans all wound up cheaper. …Benchmark prices for building materials copper and lumber dropped 22% and 31%, respectively. …Many raw materials remain historically high-price, to be sure. …Yet some investors are starting to view the reversals as a sign that the Federal Reserve’s efforts to slow the economy are reducing demand. …Higher mortgage rates have cooled the market for new homes and popped the pandemic lumber bubble. Meanwhile, coronavirus lockdowns in China and a shift in U.S. consumer spending from goods to services, such as travel and entertainment, have dimmed the outlook for cotton and copper demand. [to access the full story a WSJ subscription is required]

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