CryptocurrencyNewsTrading

Recession Fears And Crypto Bear Markets Loom As Commodity Prices Soar

As there seems to be no resolution to end the Russia-Ukraine war, prices of commodities continue to spike. Thus, many fear that a global recession may happen soon.

Actions And Consequences

While most nations are barely recovering from the negative economic effects of lockdowns and restrictions resulting from the COVID-19 pandemic, the continuation of the Russia-Ukraine war could have additional adverse consequences in the short-term and long-term outlook of the global economy. Commodity prices are often used as a yardstick for measuring economic performance.

Hence, many people, especially economic analysts, start paying attention when there are sudden spikes in commodity prices and a decline in stock markets. As of this writing, commodity prices are shooting up while crypto and stock markets are tumbling.

Commodity Prices Hitting New Highs

Commercial goods that can be substituted with similar goods in the same group are often called commodities. Since the start of the Russia-Ukraine war, the prices of grains, precious metals, oil, and gas have been rising sporadically. Thus, causing many analysts to predict that a recession is about to happen.

WTI oil prices had increased by about 39% to $126.5 per barrel (with Brent crude now trading at $131) since February 24, when Russia started invading Ukraine. On Monday, Charlie Bilello (founder of compound capital advisors) said, “it is strange that gasoline futures which hit an all-time low in 2020 is now at an all-time high today and this new ATH has surpassed the previous ATH set in 2008.”

📰 Also read:  Bitcoin Faces Short-Term Correction as Chinese Stocks Experience Sharp Decline

Top geopolitics analyst, Alexei Arora, opined that “there is always a global recession for every 50% increase in crude oil price more than the past five decades. The recession even becomes stronger when the rise in crude oil price is accompanied by a general increase in the prices of other commodities.”

Bilello further remarked that the rising prices of Copper, Palladium, and other precious metals are not a coincidence at this time because Russia supplies nearly 45% of the precious metals being used globally. The compound capital CEO added that Russia is the highest supplier of wheat globally, and wheat prices are now at an ATH in more than two decades. He also remarked that the prices of Soybeans and Corn are hitting new peak prices in about 15 years.

Gold Prices Are Also Rising 

Gold is close to hitting its all-time high and has reached its highest level in mid-2020. It has surged by 8.5% since January 2022 and trades at $1,982/oz as of this writing. Gold is about 3% shy of hitting its ATH, and analysts predict that it could achieve it before this weekend.

📰 Also read:  Price Analysis October 6th, 2024 - BTC, ETH, SOL, BNB, and XRP

By comparison, BTC’s price has been dipping since January and doesn’t seem like a store of value right now. BTC has lost nearly 19% of its value since January 2022 and is still 44% shy of its November 2021 peak price. If commodities’ prices indicate that a recession is on the horizon, then a long-term bear crypto market cannot be ruled out.


Tokenhell produces content exposure for over 5,000 crypto companies and you can be one of them too! Contact at info@tokenhell.com if you have any questions. Cryptocurrencies are highly volatile, conduct your own research before making any investment decisions. Some of the posts on this website are guest posts or paid posts that are not written by Tokenhell authors (namely Crypto Cable , Sponsored Articles and Press Release content) and the views expressed in these types of posts do not reflect the views of this website. Tokenhell is not responsible for the content, accuracy, quality, advertising, products or any other content or banners (ad space) posted on the site. Read full terms and conditions / disclaimer.

📰 Also read:  Analysts Say FTX Repayments Will Not be Super Bullish for Crypto: Here is Why

Shelly Melancon (Switzerland)

Shelly is a cryptocurrency enthusiast from Switzerland, she bought her first crypto in 2015 when it was way less popular then it is today and since 2017 she has been writing about cryptocurrency for online news portals. Shelly is the newest addition to the Tokenhell team, she writes mostly news and reviews related articles , stay tuned to her posts to stay up to date with the crypto world.

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Skip to content