12.08.2013 - Who’s afraid of declining commodity prices?
Commodity prices have increased sharply over the past ten years. Large populous emerging economies, first and foremost China, have become major consumers of commodities as they build out their infrastructure, their per capita income and nutrition patterns change and their populations become more mobile and thus consume more energy. Time will tell whether we currently find ourselves in the midst of a commodity super-cycle, or not. Either way, it is worth and prudent to ask which emerging markets would be the most sensitive to a sustained drop in commodity prices. As far as the balance of payments is concerned, it is evident that Russia (negatively) and Korea (positively) are the two EM that would be most affected by a decline in commodity prices...............................................Full Article: Source
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