Retail sales jumped sharply last month, as did inflation at the retail level. But housing construction declined for the second straight month. And more investment dollars are flowing to traditional inflation hedges like petroleum and gold.
The prospect of a bit of inflation can be encouraging to commodity producers. Farmers typically experience higher prices in such a climate. But, worries over getting a crop in the ground have overshadowed concerns about price prospects.
At the beginning of the week 62 percent oft the corn crop had been planted. That's about ten points behind the average pace, but eastern Corn Belt states like Illinois, Indiana and Ohio have only 51, 11 and 17 percent of the crop planted. This time last year, virtually all the crop in those states had been planted and was emerging.
The story is much the same for soybeans. 17 percent of U.S. soybean acres been planted, about half the normal average.
With 55 percent of the crop planted, cotton producers are ahead of the average pace.
But drought-plagued wheat producers are growing more pessimistic over yield prospects for the 2002