Author
Listed:
- Mohammed-Khalil Ghali
- Cecil Pang
- Oscar Molina
- Carlos Gershenson-Garcia
- Daehan Won
Abstract
Accurate forecasting of commodity price spikes is vital for countries with limited economic buffers, where sudden increases can strain national budgets, disrupt import-reliant sectors, and undermine food and energy security. This paper introduces a hybrid forecasting framework that combines historical commodity price data with semantic signals derived from global economic news, using an agentic generative AI pipeline. The architecture integrates dual-stream Long Short-Term Memory (LSTM) networks with attention mechanisms to fuse structured time-series inputs with semantically embedded, fact-checked news summaries collected from 1960 to 2023. The model is evaluated on a 64-year dataset comprising normalized commodity price series and temporally aligned news embeddings. Results show that the proposed approach achieves a mean AUC of 0.94 and an overall accuracy of 0.91 substantially outperforming traditional baselines such as logistic regression (AUC = 0.34), random forest (AUC = 0.57), and support vector machines (AUC = 0.47). Additional ablation studies reveal that the removal of attention or dimensionality reduction leads to moderate declines in performance, while eliminating the news component causes a steep drop in AUC to 0.46, underscoring the critical value of incorporating real-world context through unstructured text. These findings demonstrate that integrating agentic generative AI with deep learning can meaningfully improve early detection of commodity price shocks, offering a practical tool for economic planning and risk mitigation in volatile market environments while saving the very high costs of operating a full generative AI agents pipeline.
Suggested Citation
Mohammed-Khalil Ghali & Cecil Pang & Oscar Molina & Carlos Gershenson-Garcia & Daehan Won, 2025.
"Forecasting Commodity Price Shocks Using Temporal and Semantic Fusion of Prices Signals and Agentic Generative AI Extracted Economic News,"
Papers
2508.06497, arXiv.org.
Handle:
RePEc:arx:papers:2508.06497
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