Commodities Futures And Inflation

Abstract The Indian market recently opened up a new path for individual investors and traders. It is a product derivative. For those who want to diversify their portfolio beyond stocks, bonds, real estate, goods are the best choice. They provide risk management functions. But in February the emerging exchange rate in India in February checked the speculation and banned futures contracts for new wheat and rice under inflationary pressure to hopefully suppress prices.

First, commodity futures prices are directly related to factors of inflation as commodity futures represent wagers on commodity prices. Second, the futures price includes a predictable trend of the item price. Information, they fluctuate with unexpected deviations from inflation. "

In the commodity market, future contracts (futures) are traded on commodity exchanges. Over-the-counter (OTC) contract is "a contract between two parties for goods.The change of commodity determines the prices of various commodities, but most of them are part of necessities.The rise in commodity prices in the global market is various Inflation is caused in many countries. Excessive volatility in the commodity market has brought inflation and interest rate volatility (Schofield, 2011) The main problem is the calculation of the value of environmental economics, this example makes it better The existence of these species, the value that human beings can produce, is called environmental economics. Although the existence of these species is good for both society and human beings, these species Loss will affect the future use and value creation of these species.

Goods According to research by Frankel & Rose (2009), commodity prices are influenced by inflation and global production. We found that the relationship between commodity and inflation and world production is positive. In addition, microeconomic variables also affect commodity prices. For example, stock. Another evidence also indicates that inflation also affects commodity prices (Gospodinov & Ng, 2010). After the unemployment rate and crude oil price were suppressed, it turned out that the price of 23 items was influenced by inflation. Another study by Bower, Geis & Winkler (2007) also shows that inflation and exchange rates have an impact on commodity prices. On the other hand, since the research by Pindyck & Rotemberg (1990) shows that macroeconomic shock may affect inflation instability, industrial production and inflation determine future demand for goods, future commodity prices Influence.