Commodity price drops are affecting the exporting em countries economy watch exchange rate usd to cad history


Commodities are back under pressure, sending ripples through various assets classes 40 euro shoe size to us. Let us start with a recap of recent moves and drivers. In short, it looks like the risks are still bearish for energy and industrial metals, but not so much for agricultural commodities flower quotes shakespeare. We believe that the currencies and equity markets of the major exporters of industrial metals and energy are likely to continue underperforming.

Both the charts and fundamentals suggest to us that there is further downside ahead for oil. On the fundamental side, the deadline to reach a deal with Iran was extended again, but an agreement seems close php to usd conversion. Talks in Vienna have been ongoing for 10 days, and comments suggest a lot of progress has been made. The National Iranian Oil Company hopes to bring exports back to pre-sanctions levels within three months after the embargo ends.

This would mean exports of around 2.5 mln barrels per day, up from around 1.4 mln barrels per day on average in 2014 (according to the EIA) the box nyc. For comparison, Russia (the world’s second largest exporter) averaged about 4.8 mln barrels per day in 2014.

Pressure is also coming from steadily increasing supply and price cuts from OPEC. US output is also making cycle highs near 10 mln barrels per day, and last week marked the first increase in US drilling activity in 8 months binary to text converter. On the demand side, downside global growth risk from China and EU are likely to keep a lid on energy demand.

Technically, Brent is leading this move and has already broken the 62% retracement objective from its March-May bounce, which sets up a test of the March low near $52.50. Further losses would set up a test of the January cycle low near $45.20 pound to usd. WTI is being dragged lower, and is about to test the 62% retracement objective from its March-May bounce near $49.88. A break below that level would set up a test of the March low near $42.00.

Iron ore prices are back below $50 per metric ton usd to myr. The April-June rally proved short lived. Recent losses have accelerated due to concerns about slower construction activity in China as well as reports suggesting that Australia and Brazil are set to increase supply cnn money futures market. Iron ore futures are down nearly 25% since mid-June, and set to test the April low near $47. Similarly, copper futures are off nearly 20% since May levels funny quotes with pictures for facebook. There was a new cycle low in copper today below 240. Charts point to a test of the December 2008 low near 125.

As we discussed in a previous report, the El Nino phenomenon will be an important risk factor this year. Recently, a series of tropical cyclones has helped it build strength. El Nino this year has an 85% chance of lasting through winter 2015-2016, according to an updated forecast released last week by the National Oceanic Atmospheric Administration (NOAA). Experts warn about significant climatic changes this year such as heat waves in Asia, strong rain in South America, and cooler summers in North America. Data taken from suggests that in general, El Nino tends to result in strong crop yields in in the US, especially for soybeans.

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