WCU:
Commodity correction may have exhausted itself
By Ole Hansen, Head of Commodity Strategy at Saxo Bank
The
correction that for some commodities already started back in March has since
the end of July increasingly been showing signs of reversing. According to the
Bloomberg commodity sector indices, the correction period triggered peak to
bottom moves of 41% in industrial metals, 31% in grains and 27% in energy. The
main reason for the dramatic correction following a record run of strong gains
was the change in focus from tight supply to worries about demand.