April 29, 2017
If the “reflation trade” isn’t dead, it appeared lingering on life support following release of the latest position reports among big traders.
The data, collected as of Tuesday by the Commodity Futures Trading Commission, showed investors and speculators jumping ship on their wagers that tax cuts and economic growth would spur demand, both for hard assets and the paper behind them. President Trump’s economic team indeed announced its hopes for tax cuts, but the plan was barebones at best – a starting point in what could be contentious negotiations. And there’s still no word on an infrastructure plan as Congress struggles just to get a budget approved in time to avoid a government shutdown.
The CRB index of commodities eased again this week, barely holding above lows set after Trump’s election. Owning commodities was seen as a way to guard against inflation, as well as benefit from demand growth. Neither tactic has panned out.
Here’s a look at results from the April 28 Commitment of Traders.
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