Hello everyone, and welcome back to our weekly positioning watch.

Markets have been enjoying the easier financial conditions imposed by a weaker than anticipated inflation print, although yields have found their way back to pre-CPI levels. 

The big ongoing theme in markets seems to be the renewed pressures in commodities, as real world demand for crucial metals like copper and nickel has spurred significant flows into broad commodities. Supply-conditions are truly getting tight as seen in spreads between front-month futures against futures with longer expiry, and with demand staying strong, actual fundamentals are starting to favor higher commodity prices – not only survey-based demand and supply.

Most industrial metals are solidly in the green over the past week, and we are only missing crude oil to move before we truly have renewed inflationary pressures. However, risk assets might be able to extend their run towards June/July, where inflation prints will look a lot less soft.

Chart of the week: Commodities are on a run!