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Sunday, May 01, 2011

Lower Commodity Prices?

by Calculated Risk on 5/01/2011 08:44:00 PM

Three weeks ago there were a couple of articles in the WSJ about lower prices for steel and copper. Here is another more general article: Commodity Surprise: Some Are Now Heading Down

Cotton has pulled back 17% from the all-time record set in early March, and sugar is down 34% from its multidecade high in February. Lead and zinc have tumbled in recent weeks after shooting up in the second half of 2010. Copper has shed 6% this year.

The declines came amid a wild April in which other raw materials continued to climb. U.S. oil prices rose 7% for the month, while gold set fresh records in nominal terms 13 times and silver neared its all-time high.
Lower commodity prices would definitely help, but unfortunately the one that matters the most for the U.S. economy - oil prices - are still high (WTI futures are at $113.56 per barrel, and Brent Crude is at $125.56). High oil and gasoline prices are one of the key downside risks for the economy.

Summary for Week ending April 29th
Goldman estimates 3.5 million Excess Vacant Housing Units.
Schedule for Week of May 1st