Raw material price increases - is this just the beginning?

From mid-2020. gas price in the USA increased by 198%, WTI oil o 178%, copper o 98%, silver o 45%, gold o 2%. It cannot be ruled out that more significant fluctuations in commodity prices may be ahead of us.

Energy commodities, including copper, may have increased recently due to the economic expansion that followed the lifting of lockdowns. Demand for energy has risen sharply, as has demand for building materials, including copper, which is often considered an economic barometer.

Gold and silver, in turn, seem to be metals, which are more a substitute for cash or a form of investing and storing capital than assets potentially gaining in the phase of the economic boom, when the sentiment towards risk seems very high.

Gold nearly $ 1800

In the markets, there is more and more talk about a possible peak in the business cycle and thus a return to cash substitutes from riskier assets. Among currencies, the Swiss franc seems to be more expensive, both against the euro, the dollar and the zloty. Among commodities, there may be an increasing demand for gold, which today has risen in price to $ 1790 an ounce. In the background of this hike, inflationary pressure and a slightly weaker dollar in recent days remain. The US currency seems to have been in a downward trend for two weeks.

Gold has usually been used as a hedge against inflation. Currently, the pressure of rising prices is accompanied by the possibility of stagflation.

Cost inflation remains high

The main factor important for global cost inflation is fuel prices, which are to some extent derived from the price of crude oil. WTI crude oil today traded at its 7-year highs at $ 82,2 a barrel, recouping much of the previous day's losses. The increases may cause persistent concerns related to the reduction of supply in the US.

Previously, rising coal and gas prices could have led to higher consumption of oil for energy and heating purposes. However, recent figures EIA showed that US oil and fuel stocks have decreased. In the Cushing warehouse, reserves have dropped to a three-year minimum, yet the winter season is yet to begin.