Gold prices rise amid a commodity slump: What this means for the economy

While global economic chaos has hit industrial commodity prices, bullion is on a roll over hopes of a stimulus by central bankers.

ET Wealth analyses the impact these developments are likely to have on our economy and different sectors.

Bloomberg commodity index is trading close to 30-yr lows

Commodities are under pressure due to fears of a global recession. This may continue for some years.

While industrial metals have crashed, bullion has gained due to stimulus by central banks

Due to a weak rupee, domestic prices of gold are expected to continue rising in the coming years.

International gold at 6-yr high; domestic gold still higher

In uncertain times like this, it is good to have around 10-15% of your portfolio in gold.

Silver did not participate in recent bullion rally

After the gold-silver ratio reached an unsustainable level of 90, silver has started outperforming gold.

Crude oil prices have not dived due to production cuts

Softening crude oil will reduce infl ation and will allow RBI to cut rates more.

Chinese efforts stopped copper from falling to a 3-year low

Domestic copper prices will continue to be under pressure due to slowdown in the auto sector.

A production glut is bringing down steel prices

Domestic steel prices will be under increased pressure due to slowdown in infra related sectors.

Natural gas prices are close to their 10-year low

Low international prices will help rein in domestic gas prices.

Fall in aluminium prices has been restricted

Due to slowdown in the auto sector, domestic aluminium prices will remain under pressure.

Funds linked to commodities other than gold are in the red

Investors should stay away from non-bullion commodity funds now.