Commodities prices continue to rise, according to IHS Markit Materials Price Index (MPI), but growth is expected to slow going forward. As of March, prices are 68% higher than a year ago.
“The demand-side factors that have been driving prices higher for the past year—rebounding manufacturing activity, generous government stimulus, a weaker US dollar and investor buying – remain in force, though three of the four have begun to signal a change,” John Mothersole, pricing and purchasing research director at IHS Markit, said in a press release. “We expect the rise in goods price inflation to prove temporary as the market balances, the supply and demand of physical commodities improves and fundamentals reassert themselves.”