Bank economist Patricia Mohr says the decline in commodity prices, especially for metals (down 4.1% in May), will have a negative impact on Canada’s trade performance during the second quarter.
Mohr notes metal prices are returning to more normal levels. Zinc, for example, has dropped to 80 cents (US) per lb from 95 cents in March. “The price decline for zinc has been more moderate than for other metals,” she writes.
“Global concentrate supplies are tight and LME inventories are lower than at the beginning of the year. Demand for galvanized steel is still strong in the U.S. and European auto and capital goods industries.” Indices measuring a gricultural, forest-product and energy prices all recorded small gains during May.
The all-commodity index tracks export prices of a variety of Canadian commodities, which are weighted according to their 1984 export values, except crude oil where the value of net exports is used.
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