El Nino and World Primary Commodity Prices: Warm Water or Hot Air?
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Summary:
This paper examines the historical effects of the El Niño-Southern Oscillation (ENSO) cycle on world prices and economic activity. The analysis indicates that ENSO has economically-important and statistically-significant effects on world real commodity prices. A one-standard-deviation positive surprise in ENSO, for example, raises real commodity price inflation about 3-1/2 to 4 percentage points. Moreover, ENSO appears to account for almost 20 percent of commodity price inflation movements over the past several years. ENSO also has some explanatory power for world consumer price inflation and world economic activity, accounting for about 10 to 20 percent of movements in those variables.
Series:
Working Paper No. 2000/203
Subject:
Agricultural commodities Commodities Commodity prices Consumer prices Inflation Prices
English
Publication Date:
December 1, 2000
ISBN/ISSN:
9781451874440/1018-5941
Stock No:
WPIEA2032000
Pages:
34
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