# Hawkish Fed a headwind for commodity prices | Capital Economics

> The US Fed said it will soon be appropriate to raise rates and hinted at a hike as early as March. The DXY dollar index hit an 18-month high above 97, weighing on dollar-denominated commodities, and US steel and lumber prices fell.

- Date: 2022-01-28 · published 2022-01-28T12:00:00.000Z
- Category: macro · region US · magnitude medium
- Page: https://feedsoft.ai/events/43044-hawkish-fed-a-headwind-for-commodity-prices-capital-economics
- Commodities: [US Dollar (Broad)](https://feedsoft.ai/c/DXY.md), [Corn](https://feedsoft.ai/c/CORN.md), [Soybeans](https://feedsoft.ai/c/SOY.md), [Wheat (SRW)](https://feedsoft.ai/c/WHEAT.md)

## Why it matters

A stronger dollar and higher rates make USD-priced commodities more expensive for foreign buyers, a bearish pressure on feed grains and other commodities. Analysts expect the dollar to rise further this year.

## Read by commodity

- DXY: bullish ▲
- SOY: bearish ▼
- CORN: bearish ▼
- WHEAT: bearish ▼

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| DXY | 2024-06-25 | [US dollar advances after hawkish Fed comment, economic data \| Reuters](https://feedsoft.ai/events/29634-us-dollar-advances-after-hawkish-fed-comment-economic-data-reuters.md) | +0.6% | -0.3% |
| DXY | 2022-09-26 | [Commodity prices down last week amid hawkish monetary policies, recession fears](https://feedsoft.ai/events/11907-commodity-prices-down-last-week-amid-hawkish-monetary-policies-recession-fears.md) | +0.2% | +0.6% |
| DXY | 2022-04-25 | [Fed’s hawkish stance keeps commodity markets under pressure](https://feedsoft.ai/events/41759-fed-s-hawkish-stance-keeps-commodity-markets-under-pressure.md) | +1.2% | +1.1% |
| DXY | 2022-10-31 | [What Does A Central Bank Pivot Mean For Commodity Prices? \| FXEmpire](https://feedsoft.ai/events/39038-what-does-a-central-bank-pivot-mean-for-commodity-prices-fxempire.md) | -0.1% | -2.8% |
| DXY | 2021-06-18 | [Fed surprise points to further dollar strength \| Capital Economics](https://feedsoft.ai/events/5931-fed-surprise-points-to-further-dollar-strength-capital-economics.md) | -0.2% | +0.4% |
| CORN | 2020-04-21 | [COVID-19 infects nearly all commodity prices \| Capital Press](https://feedsoft.ai/events/6503-covid-19-infects-nearly-all-commodity-prices-capital-press.md) | -1.6% | +0.5% |
| CORN | 2022-09-26 | [Commodity prices down last week amid hawkish monetary policies, recession fears](https://feedsoft.ai/events/11907-commodity-prices-down-last-week-amid-hawkish-monetary-policies-recession-fears.md) | -1.4% | +2.6% |
| CORN | 2022-04-25 | [Fed’s hawkish stance keeps commodity markets under pressure](https://feedsoft.ai/events/41759-fed-s-hawkish-stance-keeps-commodity-markets-under-pressure.md) | +0.4% | -2.0% |

## Sources

- capitaleconomics.com: https://www.capitaleconomics.com/clients/publications/commodities-overview/commodities-weekly-wrap/hawkish-fed-a-headwind-for-commodity-prices

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.