• NAB’s Non-Rural Commodity Price Index is expected to increase by 0.9% qoq in Q2 2019 (a little stronger than anticipated in May). Individual trends are highly mixed, with iron ore surging on supply constraints, while base metals have fallen on the deteriorating US-China trade relationship.
• The weaker global economic outlook is likely to impact demand for commodities – however uncertainty around iron ore supply and the global trade environment provides considerable risk.
• In annual average terms, the USD index is forecast to rise by 3.7% in 2019, before declining by 6.9% in 2020. Lower prices for iron ore and metallurgical coal are the main contributors to this trend.
• The changes are larger in AUD terms, with the index rising by 8.8% in 2019 then falling by 11.6% in 2020.

Find out more in the NAB Minerals & Energy Outlook – June 2019