MEXICO CITY, MEXICO – The world is watching and waiting to see if commodity prices have found their new bottom. Recently, the Thomson Reuters Core Commodity Index, which tracks and measures the performance of 19 different commodities, closed below the 200 threshold – something the market had not seen in over a decade. Contributing factors to this result are a number of “unknowns” on the horizon, including developments in the Chinese markets, the Fed’s pending decision on increasing interest rates in the US, and Iran’s future role on the already over-productive oil market. Foreign exchange specialist Pablo Soria de Lachica predicts that, at least for the moment, commodity prices will continue their stabilized performance until new forces exert themselves on the global commodities market.
“One of the biggest risks that the commodities market are facing is a strengthening of the US dollar,” says Pablo Soria. This is why all eyes will be on Janet Yellen in September, when the Federal Reserve will finally announce whether US interest rates is going to see their first hike since June of 2006. Although the Fed has sent some fairly strong signals that there will be a slight increase in interest rates this fall, market forces could still step in and dissuade that particular course of action. The current commodities sell-off and some fairly mixed signals about the United States’ economy and the performance of the dollar could easily come into play between now and then. At Kartoshka, Pablo Soria de Lachica anticipates that this uncertainty will bring a period of relative stability until September rolls around. During this time, metals, energy, and agricultural commodities will likely see a fairly steady performance until market forces finally determine if this is a new bottom or if prices will fall even further.
While investors are looking to the Fed for hints, eyes are also on China and the efforts that the government is taking to stabilize the country’s markets. In order for commodities to start climbing once again, a certain level of growth from China and other emergent markets is needed. Pablo Soria de Lachica predicts that until investors have more portents from the Fed and from the Chinese markets to interpret, highs and lows will bring about little lasting fluctuations. Once prices do finally start to move, chances are high that they will be on the rise. A current trend analysis indicates that prices are hovering around a new bottom. “The only real question left to answer right now,” says Soria de Lachica, “is, how low will they go?”
Pablo Soria de Lachica is the Director of Business Development at Kartoshka and a foreign exchange specialist. He has taken his expert status and international acclaim to create trading platforms that empower investors to make smarter decisions and better measure the performance of their portfolio. Pablo allows beginning investors to interact with the markets from a risk-free approach that better prepares them for the pressures once they are faced with the quickly changing conditions in the world of finances.
Pablo Soria de Lachica – Recommends Profitable CFD Indices: http://www.msn.com/en-us/news/other/pablo-soria-de-lachica-recommends-profitable-cfd-indices/ar-BBm1sxB
Pablo Soria de Lachica – Explains How the July NFP Report Impacts Forex Trading: http://www.marketwatch.com/story/pablo-soria-de-lachica—explains-how-the-july-nfp-report-impacts-forex-trading-2015-08-20