The end of the reflation trade?

The fall in the commodity complex does not seem to portend a steep fall in global growth prospects

Once again commodity prices are getting hammered. Oil prices have dropped below $50 a barrel, and continue to show weakness. Iron ore prices are down 30 per cent, with many other commodities, including copper, down double digits. There are growing fears that the whole commodity complex is once again coming under pressure. Does this price action have any information value for global growth? Should we be worried? Equity markets globally are expensive, and priced for accelerating growth and earnings. Worryingly, the two pillars of the global reflation trade, China and the US, are both showing weakness. 

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