Commodity price spikes and falls can be affected by consumer movements

This week's analysis provides an insight into the factors affecting commodity pricing

The US-based S&P Goldman Sachs Commodities Index, illustrated in the graphs below, indicates the changes in the pricing of both hard and soft commodities. In May, the index registered its biggest one-month gain since Iraq invaded Kuwait in September 1990, rising 19.67% last month compared to 22.94% at that time. The composite index represents an unleveraged, long-only investment in commodity futures, diversified across a spectrum of commodities. It is denominated in US dollars and weighted on a world production basis. Its composition is reviewed on a monthly basis, and has returned 5.95...