Yes, commodity prices are zooming, the Dow Jones Commodity Index is near a 10 year high - in US dollar terms (Chart 1). But, what if you are paying in Euro, Yen or Aussie Dollars?
Chart 1 - Commodity Price Index in US Dollars
In euro, commodity prices are already past their 10 year high - Chart 2.
Chart 2 - Commodity Price Index in EUR
If you are paying Yen, commodities are even more expensive - Chart 3.
Chart 3 - Commodity Price Index in JPY
And what if you are a producer of commodities, say Australia? You are very pleased, indeed - Chart 4.
Chart 4 - Commodity Price Index in AUD
Finally, here is a comparison chart of the Commodity Index in USD (blue mountain) with the 10-year Treasury bond yield (red line) - Chart 5.
Chart 5 - Commodity Price Index in USD and 10-Year Treasury Yield
It looks to me that interest rates have a long way to go higher before they catch up to commodities. That, or commodity prices will come crashing down because the current hyper-optimistic global economic growth expectations are proven false.
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