More of the same

Commodity markets have been relatively quiet over the last few weeks, with many prices trading in a narrow range. There are a few exceptions, most notably the prices of natural gas and coal, which have soared on the back of surging power demand and constrained supply. In contrast, oil has continued to hover around $70 per barrel, as concerns about demand prevent price gains and as OPEC+ supply restraint acts as a floor under prices. We think next week could be a bit directionless again. China is set to publish its monthly activity and spending data on Wednesday, which we expect to show further weakness. So far, commodity prices have been surprisingly sanguine about the economic downturn in China. But there are now clear signs that growth in the US and UK economies is also slowing, which underpins our view that most commodity prices will be falling as we move into 2022. CE Spotlight 2021: The Rebirth Of Inflation? We’re holding a week of online events from 27^th September to accompany our special research series. Event details and registration here.