Commodity prices fall for third month in August

New Zealand's main commodity prices fell for the third straight month in August, further backing views that prices have peaked, ANZ Bank said today.

The ANZ World Commodity Price Index fell 0.9 per cent in the month, following a 0.5 per cent drop in July and a 0.6 per cent slip in June.

However, ANZ reiterated its view that the recent weakness was only a consolidation following a rise to record high levels in May and did not signal further rapid falls.

"It would be unwise to read too much into modest movements in the index in recent months," said chief economist John McDermott.

"Indeed, the index is just 2 per cent short of its peak in May and remains above the level prevailing a year earlier."

In New Zealand-dollar adjusted terms, the index fell 2.6 per cent in August, as a 2 per cent rise in the dollar amplified the fall in prices.

During August, the kiwi briefly pushed up above 71 United States cents to a seven-week high, compared with around US68 cents at the beginning of the month.

It stood at around US69.50 cents at end-August.

Of the 13 commodities monitored, apples marked the largest decline of 22.8 per cent, adding to a 12.2 per cent fall in July due to oversupply. Kiwifruit rose 4.2 per cent, rebounding from a 3.5 per cent fall in July.

- REUTERS