Commodity prices gain momentum

<p>Kia ora,</p><p>Welcome to Friday's Economy Watch where we follow the economic events and trends that affect New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news of more momentum in the commodity super cycle.</p><p>Firstly, the US <a href="https://www.dol.gov/sites/dolgov/files/OPA/newsreleases/ui-claims/20210839.pdf" target="_blank"><strong>reported</strong></a> a big drop in jobless claims for last week, reinforcing the recovery in their labour market. There are now 'only' 3.8 mln people on these benefits, a very sharp decrease from the 22 mln a year ago. In fact, the latest data suggests 'normal' pre-pandemic claims levels are now in sight. In fact, <a href="https://www.challengergray.com/blog/what-a-difference-a-year-makes-job-cuts-fall-to-22913-lowest-monthly-total-since-june-2000/" target="_blank"><strong>announced layoffs and job cuts</strong></a> fell in April to their lowest level in more than 20 years.</p><p>In Canada, home prices could climb +14% this year as low rates stoke demand, their housing market regulator <a href="https://assets.cmhc-schl.gc.ca/sites/cmhc/professional/housing-markets-data-and-research/market-reports/housing-market/housing-market-outlook/2021/housing-market-outlook-61500-spring-2021-en.pdf?rev=c2fff441-c2f4-4fcd-97ec-6f7ac21e4a6c" target="_blank"><strong>says</strong></a>.</p><p>But today it is all about commodity prices. Increasing optimism over the global economic recovery has pushed all higher. Government stimulus measures and rising investment in doing the job. However, supply side issues are also contributing to market tightness.</p><p>For <a href="https://www.interest.co.nz/charts/commodities/semi-precious-metals" target="_blank"><strong>copper</strong></a>, the transition to sustainable energy networks has powered its price to over US$10,000/tonne. <a href="http://www.dce.com.cn/DCE/Products/Industrial/Iron%20Ore/index.html" target="_blank"><strong>Iron ore</strong></a> prices rose sharply again ye