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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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Free AccessOil and Nat Gas Are The Best 'Inflation-Hedges'
- While the rise in uncertainty over the Delta variant in addition to the contraction in Chinese liquidity have led to a moderate to significant consolidation in some commodities (i.e. copper down 12%, lumber down 50%), momentum in oil and Nat gas prices continues to look firm.
- Historically, investors have viewed energy commodities as the best 'inflation hedges' when inflationary pressures start to rise.
- This chart shows the average monthly performance of 10 of the most traded commodities since 1980 (Times series start in 1983 for oil, 1989 for copper and 1990 for Nat gas) when inflation is accelerating (i.e. 1Y change in CPI inflation is positive).
- Interestingly, oil and Nat gas come at the top, averaging 1.9% and 1.7% in monthly returns.
- Can the momentum in oil and Nat gas continue if inflation continues to surprise positively in the coming months?
Source: Bloomberg/MNI
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.