Index of Commodity Prices August 2014

Preliminary estimates for August indicate that the index rose by 1.6 per cent (on a monthly average basis) in SDR terms, after declining by 1.3 per cent in July (revised). The largest contributor to the increase in August was the price of iron ore. The base metals subindex rose in the month while the rural commodities subindex declined. In Australian dollar terms, the index increased by 1.5 per cent in August.

Over the past year, the index has declined by 11.5 per cent in SDR terms, largely driven by declines in the prices of bulk commodities. The index has declined by 13.6 per cent in Australian dollar terms over the past year.

As indicated in previous releases, preliminary estimates for iron ore, coking coal and thermal coal export prices are being used for the most recent months, based on market information. Using spot prices for these commodities, the index fell by 0.8 per cent in August in SDR terms, to be around 16 per cent lower over the past year.

For further details regarding the construction of the index, please refer to ‘Changes to the RBA Index of Commodity Prices: 2013’ in the March 2013 issue of the Bulletin and ‘Weights for the Index of Commodity Prices’ (March 2014).