InvestorQ : How has the progress in the development of the vaccine had an impact on the prices of commodities across the world?
Dhwani Mehta made post

How has the progress in the development of the vaccine had an impact on the prices of commodities across the world?

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Dilmini Mercia answered.
3 months ago
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The vaccine progress has surely come as a boon for the stock markets, but the question is whether it has impacted the commodity markets too. If you go by recent trends in oil gold and other industrial commodities, then the impact has been quite profound.

During the month of November 2020, riskier commodities like base metals and crude oil trended higher in the markets while safe havens like gold and silver struggled to hold value as there was greater certainty in the market. This was due to improvement in risk appetite amid positive development on the vaccine.

Gold and silver have traditionally been two precious metals have been the storage of last resort. However, as the safe haven demand got dented prices of gold and silver slipped to recent lows. In fact, gold and silver have been consistently slipping for the past three consecutive weeks.

However, there has been an uptrend visible across base industrial metals pack and crude oil. The factor that lent support to commodities is signs of progress on US stimulus talks along with weakness in US Dollar Index. The US could be standing on the threshold of a massive $908 billion Coronavirus aid plan.

The base metals and crude oil held on to gains amid optimism over virus vaccination. Further, base metals prices are also benefiting from upbeat demand outlook from China, the world’s undisputed leader in commodity demand. China reported robust factory activity as well as services activity data, raising hope that demand for industrial metals are back.

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