Wheat and Oil Rise in Global Commodity Markets
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Wheat closed the week with a 7.7% gain and Brent crude oil with a 7% gain, influenced by the US Department of Agriculture report and geopolitical developments.
Weekly Gains in Agricultural Commodities
Agricultural reports, energy geopolitics, and US macroeconomic data shaped commodity prices in the global markets during the past week. Activity in agricultural products accelerated following the release of the World Agricultural Supply and Demand Estimates (WASDE) report by the US Department of Agriculture. Throughout the week, wheat prices stood out with a 7.7% increase, while corn gained 4.7% in value. Brent crude oil rose 7% due to geopolitical developments focused on the Strait of Hormuz, and silver, among precious metals, gained 1.8%.
Macroeconomic Indicators and Interest Rate Balance
Data released across the US dampened expectations of interest rate hikes in the markets. According to US data, the Consumer Price Index in July increased by 0.1% monthly and 3.4% annually. While annual inflation reached its lowest level in the last 4 months, core inflation was realized at 2.5%. The annual Producer Price Index remained at 4.7%, while retail sales decreased by 0.6%. Following this picture, the probability of the US Federal Reserve implementing a potential interest rate hike in September has significantly weakened.