What Inflation?

From Bloomberg:

Wheat surged to record highs on three U.S. futures exchanges as millers and overseas importers faced shortfalls of spring grain, used to make bread and pasta and other food staples.

Spring wheat harvested in September and October was sold in forward contracts by farmers and grain-elevator operators, triggering a shortage of supplies this year, analysts said. Demand has surged for the high-protein grain, and futures in Minneapolis, where spring wheat is traded, have almost tripled in the past year.

``You have to have it,'' said Jon Marcus, president of Lakefront Futures and Options LLC in Chicago. ``You can't say, `Well, we just didn't make any bread today.' You can't just quit your business because prices are too high, though I'm sure there are some people going out of business. You have to buy it.''

From Bloomberg:

Copper jumped more than 4 percent to a three-month high as falling inventories quelled concern that demand for the metal may slump.

Stockpiles monitored by the London Metal Exchange dropped for a fifth-straight session to 169,475 metric tons. Supplies have slipped 14 percent this year. Copper has gained 14 percent since Dec. 31 partly on concern supplies will lag behind demand.

``We're seeing rather strong demand on the LME as indicated by the drawdown in inventories,'' said Catherine Virga, a metals analyst at CPM Group in New York.

Copper futures for March delivery climbed 14.5 cents, or 4.4 percent, to $3.454 a pound on the Comex division of the New York Mercantile Exchange. The contract settled at the highest price since Oct. 31.

From Bloomberg:

Gold futures rose on speculation central banks around the world will follow the U.S. in cutting borrowing costs, boosting the appeal of the precious metal as an alternative to holding currencies. Silver also gained.

The Bank of England today cut its benchmark lending rate for the second time since December, and the European Central Bank signaled it may lower rates later this year. Gold rose 31 percent last year as the Federal Reserve cut borrowing costs to avoid a recession.

``You're going to see central banks start to cut rates,'' said Nick Ruggiero, a trader at Eagle Futures Inc. in New York. ``Gold will stay very strong.''

Gold futures for April delivery rose $5, or 0.6 percent, to $910 an ounce on the Comex division of the New York Mercantile Exchange. The price earlier touched $915.20.

Silver futures for March delivery gained 22.5 cents, or 1.4 percent, to $16.775 an ounce. The metal has climbed 12 percent this year.

Commodity prices look well contained -- where have I heard that before? Hmmmmmm.....