Published
2 years ago on
April 15, 2022
Since the start of 2022, commodities have become the hottest topic in finance. The trend, primarily driven by the energy sector, agriculture, and in industrial metals, has begun to cause a stir elsewhere across global markets. Changes in the situation with significant geopolitical commodities like oil and gold have put pressure on fiat currencies. Rising inflation impacted by these commodities is even causing the stock market to suffer. Their importance within the global economy has never been more apparent.
Read on to find out why PrimeXBT is the best platform to get exposure to each of the most critical hot and trending commodities on the market today.
Pandemic Creates Conditions For Unprecedented Supply Shock
The supply shock that is causing widespread inflation and runaway prices in commodities has been in the process for more than two years. It began at first when the COVID pandemic introduced lockdown measures and shut down productivity across the globe.
The butterfly effect first kept people home from their jobs, but later the Great Resignation, the side gig economy, and more have further disrupted typical economic turnaround. Bottlenecks in container ships globally have further prevented goods from reaching store shelves, while consumers buy up even high-priced luxury goods at an unprecedented rate.
The result is less raw materials, and due to the laws of supply and demand, because the demand has only increased while supply has diminished, the cost must increase to accommodate this discrepancy until equilibrium returns.
In the meantime, consumers are forced to pay the highest increase in prices in more than 41 years. There is also no end in sight with lockdowns continuing in major economic cities like Shanghai.
