UhOh, deflation in Q2

$DJAAG (agricultural commodity prices, green line), $DJAEN, (energy, grey area curve in the background), $DJAIN (industrial metals prices, blue line) and $DJAPR ( precious metals prices, red line), Q2 2013

I’ve previously written about falling commodity prices, a trend that seems that have intensified over the past three months.

There are two charts in this post, each reflecting performance of various commodities or commodity groups over the last quarter. The chart above shows four broad commodity price series, specifically $DJAAG (agricultural commodity prices, green line), $DJAEN, (energy, grey area curve in the background), $DJAIN (industrial metals prices, blue line) and $DJAPR ( precious metals prices, red line). Each show signs of price drops, with precious metals experiencing the most significant decline, some -24.07%, across the period.

The chart bellow shows six “soft” commodities, five of which have declined in value as well during the second quarter. Specifically, Coffee is down -11.94%, Sugar dropped -6.25%, Wheat declined -4.58%, Corn dropped -1.62% while the DJ-UBS Cocoa index fell -1.28%. The only commodity of this group to rise were Soybeans, up +1.78%.

So we’re seeing signs of deflation in spite of The Fed’s Quantitative Easing. What other nation on earth has engaged in Quantitative Easing? What other nation has experience deflation? I’ve written about Japan’s problems before.

Coffee, Sugar, Wheat, Corn, DJ-UBS Cocoa index, Q2 2013

Coffee, Sugar, Wheat, Corn, DJ-UBS Cocoa index, Q2 2013

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