Even mortgage indexes bounced in the crisis. Today, the Baltic Dry Index fell for the 30th session in a row.
- Down 61% in January
- The catalysts are an increase in the number of ships and lower Chinese steel output
- Even more ships now coming online after Chinese New Year
- Shipping returns below-cost on 16 of 24 routes.
The ebb and flow of the Baltic Dry index has been a terrible leading indicator for the past 3 years and this seems to be a shipping issue rather than an economic one. Still, it’s a spectacular collapse and it’s better to be bearish in commodity FX, especially with the spike-reversal/double-top in AUD/USD.
