The Bank of Nova Scotia (TSX:BNS) says its commodity price index, which measures price trends in 32 of Canada’s major exports, suffered its third consecutive monthly decline in October.
The October drop of 3.7%, which followed a 1.1% dip in September, means Scotiabank’s overall commodity index has fallen 9.8% from its near-term peak in April — prior to market concern over eurozone debt crisis.
“While significant, the commodity price correction remains mild compared with the 40% plunge in the second half of 2008,” the bank said, noting that there have also been some positive developments in recent weeks.
“Many exchange-traded commodity prices such as copper and zinc have edged up in November and are above the lows of early October,” said Patricia Mohr, vice-president, economics and commodity market specialist at Scotiabank.
“However, intensifying economic and credit concerns in Europe have contributed to renewed downward pressure on prices in the past week,” Mohr added.
As well, the failure of the U.S. congressional supercommittee to agree on a further deficit reduction measures has added to uncertainty, she said.
The metals and minerals Index was the big decliner in October, down 6.9% month over month with broad-based declines in base and precious metals and lower quarterly contract prices for Western Canada’s coking coal. Those more than offset a moderate increase in overseas potash prices.
The oil and gas index eased by -0.6% as lower Edmonton par prices for light crude and a further decline in Canadian natural gas export prices to the United States just offset firmer heavy crude oil at Hardisty, Alta. and stronger propane prices.