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The Effects on Commodity Prices of Extraordinary Monetary Policy

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  • Amatov, Aitbek
  • Dorfman, Jeffrey H.

Abstract

This article examines the relationship between Federal Reserve monetary policy and other macroeconomic indicators to both a broad commodity price index and an agricultural commodity price index by employing a vector error correction model. Excessive liquidity and the recent long period of ultralow interest rates appear to have played a statistically significant role in affecting prices in the commodities markets. The responses of commodity prices to monetary policy that we estimate generally conform to earlier findings, but the sensitivity of the responses appears different in the face of the unprecedented scope of recent Fed activism.

Suggested Citation

  • Amatov, Aitbek & Dorfman, Jeffrey H., 2017. "The Effects on Commodity Prices of Extraordinary Monetary Policy," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 49(1), January.
    • Handle: RePEc:ags:joaaec:350128
    DOI: 10.22004/ag.econ.350128
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    References listed on IDEAS

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    1. Jeffrey H. Dorfman & William D. Lastrapes, 1996. "The Dynamic Responses of Crop and Livestock Prices to Money-Supply Shocks: A Bayesian Analysis Using Long-Run Identifying Restrictions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(3), pages 530-541.
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    Cited by:

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    2. Ghosh, Bikramaditya & Gubareva, Mariya & Ghosh, Anandita & Papadas, Dimitrios & Vo, Xuan Vinh, 2025. "Food, harvesting and interest rate nexus: Quantile investigation about dependencies and spillover," International Economics, Elsevier, vol. 182(C).

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