Understanding the emerging economic patterns from around the world could help investors plan their marketing strategies in order to maximize profit. According to the research conducted by Citi Research, it was established that investors need to re-evaluate the way they do business because even though demand is expected, commodity prices are not going to move up. This means that the global economy, as a whole, will no longer consider commodity prices as strong determinants for growth.
Researchers explain that as the demand slowly increases, commodity prices will be torn between two groups: the losers and the winners. Toying with the economic equilibrium will result in consumers depending on which group wins and which determines the demand and supply for specific commodities. And just like the law of demand and supply dictates, the higher the demand and the lower the supply, the higher the prices will be too.
Here are a few examples.
Just a few years back, the US invested in natural gas. There was a wealthy supply of such energy source and thus created a lot of surplus. The resulting energy boom created enough inventories of the fuel. In return, it also contributed to the decrease in fuel prices during the early part of this year. The level of price decrease was enormous that it was actually the first of its kind seen in the last decade.
However, the decrease of fuel price was only temporary. Once the public got used to the use of natural gas and the surplus ran out, fuel prices have started to rebound. The same technique was used in most other commodities like in the bulk and industrial commodities and even oil. But just like what happened to natural gas, prices have rebounded too.
The same principle is seen at work today but no longer on commodities. The influx of online lenders offering bad credit loans has resulted to a surplus of loan providers. When word of the service first got out, the interest rate was really high as the terms and conditions still need to be ironed out. There were a lot of speculations on the validity of the service, especially on its legality. So in order to attract more customers, lenders offered a reduction in interest rates together with a simpler application process.
There are other factors that influence the prices of commodities and services these days. Seasonality has a role to play. Foods that are in season cost cheaper than those that are not. There are only a few exemptions to this rule and these will be along the financial and health sectors. Loans will always be in demand no matter the time of the year; this goes the same with healthcare services.
Economy experts assert that it is very important that stakeholders get a strong grasp of what is happening worldwide in order to get the most out of their investment. Changes in marketing and advertising trends are to be expected especially if you are in the industry of commodities. The people behind the Citi Research explain that these changing patterns should dictate the ways with which your investment will grow and prosper.