Recent Updates
- Japan: Japan: CPI, Government Bond Trading Volume by Category of Investors (Apr)
- New Zealand: Overseas Merchandise Trade (Apr)
- UK: Consumer Confidence Barometer (May)
- UK Regional: Regional Consumer Confidence Barometer (May)
- more updates...
Economy in Brief
U.S. Index of Leading Indicators Fell in April
Five of the index's components fell in April, one was unchanged and four increased...
U.S. Unemployment Claims Rose in the Latest Week
The state insured rates of unemployment in regular programs vary widely...
U.S. Housing Starts Dip in April but Remain Elevated
The pattern of housing construction activity seems to be shifting toward multifamily...
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Profits and Margins Plunge In Q1: Expect More Margin Contraction As Fed Squeezes Inflation
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation & Fed Policy: A Relationship Which Should Worry The Fed And Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller May 22, 2020
• Oil prices rise as lockdown eases.
• Metals prices improve.
• Plywood prices surge.
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) jumped 9.4% during the four weeks ended today. The price index has rebounded to the highest level in two months after falling to an 11-year low. Prices remained 13.3% lower than twelve months earlier.
Strength in the crude oil & benzene group led the price rebound, up 57.2% in the last four weeks. WTI crude oil prices surged to $32.43 per barrel, up from $11.66 four weeks earlier. Prices remained down from a high of $61.92 in the first week of January. Prices of the petro-chemical benzene rose 7.4% in the last four weeks (-55.3% y/y). Excluding crude oil, industrial commodity prices rose 1.9% during the last four weeks but were off 10.6% over the last year.
Prices in the miscellaneous group increased 2.1% in the last month as the cost of tallow (used for food preparation) surged 20.7% (25.0% y/y). Framing lumber prices rose 8.0% but the cost of plywood held steady (-7.7 y/y). Natural rubber prices also were unchanged over the last month. Prices in the metals group improved 2.0% during the last four weeks as the cost of copper scrap rose 3.7% and zinc prices increased 5.0% (-26.4% y/y). Steel scrap prices improved 2.0% but aluminum prices eased 0.5%. Lead prices slipped 0.8% (-9.1% y/y) in the last four weeks. Rising by 1.3% were prices in the textile group. Cotton prices surged 8.3% but the cost of burlap (used for sacks, bags & gardening) held steady (1.2% y/y).
The deepening factory sector recession likely will keep industrial materials prices weak. Industrial output plummeted 13.7% in April (-18.0% y/y) as the effects of the coronavirus spread. During the last ten years, there has been a 54% correlation between the y/y change in industrial commodity prices and the y/y change in factory sector production.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases.
An Unemployment Crisis after the Onset of COVID-19 from the Federal Reserve Bank of San Francisco is available here.
| FIBER Industrial Materials Price Index (%) | 1-Mth | 3-Mth | 6-Mth | 12-Mth | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| All Items | 9.4 | -11.8 | -9.8 | -13.3 | 1.1 | -12.0 | 6.7 |
| Excluding Crude Oil | 1.9 | -9.8 | -7.2 | -10.6 | -0.6 | -11.1 | 4.9 |
| Textiles | 1.3 | -2.4 | -0.5 | -2.0 | -1.6 | -2.8 | 3.0 |
| Cotton (cents per pound) | 8.3 | -15.4 | -10.7 | -12.5 | -6.6 | -9.2 | 9.8 |
| Metals | 2.0 | -9.7 | -11.5 | -16.7 | -4.3 | -12.2 | 18.6 |
| Aluminum ($ per metric ton) | -0.5 | -13.5 | -16.5 | -17.7 | -6.5 | -12.7 | 26.0 |
| Copper Scrap (cents per pound) | 3.7 | -8.0 | -9.2 | -11.2 | 3.5 | -16.1 | 29.3 |
| Steel Scrap ($ per ton) | 2.0 | -8.2 | -4.6 | -16.6 | -0.8 | 2.3 | 16.8 |
| Crude Oil & Benzene | 57.2 | -31.2 | -31.3 | -32.8 | 20.2 | -20.0 | 8.1 |
| Crude Oil (WTI, $ per Barrel) | 178.1 | -38.5 | -43.2 | -47.5 | 35.5 | -24.4 | 10.9 |
| Miscellaneous | 2.1 | -10.2 | -3.5 | -8.3 | -0.0 | -14.8 | -0.5 |
| Framing Lumber ($ per 1000 board ft.) | 8.0 | -22.6 | -13.2 | 1.2 | 22.6 | -23.1 | 20.0 |
| Natural Rubber (cents per pound) | 0.0 | -6.8 | -3.1 | -16.7 | 10.7 | -4.1 | -29.6 |
