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No Aid for Slumping Commodities as Fed Rate Move Bolsters Dollar

  • Higher cost of imports may slow demand, particularly in Asia
  • Metal traders, U.S. motorists may feel pinch; Gold may gain
Updated on

The Federal Reserve isn’t doing any favors for commodity markets already enduring the longest slump in decades.

By raising U.S. interest rates for the first time since 2006, the central bank has bolstered the value of the dollar, the currency used around the world to buy and sell most raw materials. Even with global surpluses and slowing economies keeping prices low for everything from crude oil to wheat, demand may weaken, especially from major importers in Asia like China and India that have been key drivers of commodity buying.