Greenflation and Inflation. Why Are Commodity Prices Rising?

Greenflation and Inflation. Why Are Commodity Prices Rising?
(AP Photo/Evan Vucci)

Commodities do not generate as much investor interest as state-of-the-art tech companies. And no prices for copper, corn and even oil can compete in popularity with Elon Musk's tweets. However, today commodities are at the intersection of three critical investment factors; rising inflation, changes in China and the phase-out of fossil fuels amid increased attention to climate change. Why you should pay attention to raw materials, says Correspondent.net. 

Inflation, which at the end of last year broke multi-year records almost all over the world, was one of the main drivers of the latest economic and market trends. Because of inflation, many stocks fluctuate wildly, and investors are turning to commodities to protect themselves, Barron's writes. If you can't beat them, join them. This is a fairly common strategy: if inflation rises, then commodity prices tend to rise along with it, so part of the portfolio will be in profit, even if the profitability of other assets falls.

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