Commodities continue to outperform
We start this week with a chart on commodity prices that we have posted previously as it is worth tracking throughout the year.
From the start of 2022, the S&P GSCI commodity price index has risen by the most since 1970 as the war in Ukraine continues to put upward pressure on prices. Commodity prices tend to display long, cyclical ups and downs because it takes a long time to ramp up investment and increase supply (e.g., construction time of oil platforms). The current price shock will not be as temporary as many economists believed last year, which is turning into a headache for central bankers wrestling with inflation far above target. Warnings about a new commodity super-cycle are not farfetched.