Commodities head for biggest decline in 50 yrs

Copper, corn and silver drove commodities toward their biggest weekly decline in more than 50 years on concern that the worst financial crisis since the Great Depression will push the US into recession. Commodities, as measured by the Reuters/Jefferies CRB Index of 19 raw materials, have tumbled 9.9 per cent this week, the most since at least 1956.

Manufacturing declined to a 7-year low in the US and contracted at the fastest pace in 16 years in the US last month. Initial jobless claims rose to the highest since 2001, the US Labour Department said yesterday. “The string of poor US and EU economic data and fears of a weakening Chinese housing market gave further tangible support to increased bearish sentiment as markets seem to be pricing in a much slower growth forecast for the global economy,” Hussein Allidina, commodity research analyst at Morgan Stanley said.