It seems there is no stopping the rise in commodity prices of late. Just yesterday the news was about the steep drop in commodity prices due to concerns about economic growth. One day later, and we have hit new highs on such commodities as oil, gold, and corn. The price action in commodities over the last two days is indicative of the overall environment right now. Just as soon as market strategists 
begin to declare the commodity prices boom over with, or due for a major pullback, commodities drop for one day and then regain everything the next. It is a situation of one step backwards and two step forwards in the prices of these resources.
Oil has been the headliner in the boom, and justifiably so. Oil has now crossed its inflation-adjusted high from 1981, and has risen in price by 74% in just the past year. OPEC decided not to raise production today, and that was enough of a reason for traders to buy up as much oil as possible today, sending oil higher by a stunning $5 per barrel in one trading session.
Also hitting new all-time high today was gold. Gold prices hit $995 overnight, and settled at $988.30 today. Gold prices have been aided by the stunning plunge in the value of the US dollar. The dollar continues to hit new lows against the euro and many other major currencies.
Not to be outdone by the other two, corn prices soared as much as 3.6% today to hit a brand new all-time high. Corn prices have reached previously unheard of numbers as traders continue to believe the surge in energy prices could lead to increased demand for corn-based ethanol.
All of these commodity prices surging higher by the day certainly have to be accounted for in the economic system at some point. Inflation fears have grown greatly in the past few months, and several very wise commodity experts are warning of the harmful effects these prices will cause to the inflation rate in the United States if this continues. Stay tuned as GrowYourFunds will have many more posts in the near future regarding inflation, stagflation, and how it all relates to the commodity prices boom.
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