TORONTO, Ont.– Scotiabank’s Commodity Price Index plunged -10.3% month-over-month (m/m) and -15.4% year-over-year (yr/yr) in December to mid-2009 levels.
“A fight for market share in international oil and iron ore markets as well as general unease over lacklustre global economic conditions and an almost ‘deflationary’ environment — particularly in the Eurozone and Japan — contributed to widespread softness in commodity prices,” said Patricia Mohr, Vice President of Economics and Commodity Market Specialist at Scotiabank. “However, in contrast to many commodities, gold prices have strengthened in recent months — a welcome development for the Toronto Stock Exchange.
“Uncertainty over global growth and pressure on some oil-related currencies has given gold a renewed bid as a ‘safe haven’. The outlook for the physical gold market also appears to be fairly strong, with record or near-record bullion imports into India in the second half of fiscal 2014.
“After retreating to low levels, silver prices have rallied to US$17-18 per ounce, a positive development for the world’s major producers in Mexico and Peru. Mexico is the world’s top silver producer, accounting for 20.7% of world production, and Peru the second largest, with a 14.4% share.”