After Stocks, Bonds and Gold It Is Time For Food Prices To Fall

October 07 00:00 2011

New York, October 7 ( – World Food Prices continue to fall in September as data regarding the poor state of affairs of the International economy continues to surface. The Food And Agriculture Organization (FAO) index, which is considered to be a barometer of the state of affairs of the world food market has fallen from 229.5 to 225. While this may be considered a small fall, the very fact that prices have fallen are depressing because this market is usually rising.

The last time the FAO index fell two months in a row was during June and July 2008. This has sent shockwaves amongst many investors who consider the price of food to be the leading indicator of the overall health of the economy.

Analysts say that there is absolutely no reason for the prices of food to fall except for the fact that there may be a fall in demand keeping in mind the forthcoming inflation. The International Monetary Fund (IMF) has also stimulated the fall by further cutting its forecasts of global growth to 4% from the erstwhile 4.3%. This is getting more investors to panic and sell their grains drawing down the prices.

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