Daily iron ore price update (TSIPIO62 Index)

All quiet on the eastern front…

Here is the chart I promised yesterday, the spread between the 12m swap and spot price expressed as a percentage of spot:

Oh yeh, the rally is out of room, in fact, overshot already.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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  1. It’s only a very short time frame to draw any conclusions, but if previous two examples are anything to go by then the lower it spikes to the downside the higher it it bounces to the upside e.g. drop to -14%, peaked above 20%, drop to -8%, peaked above 15%… if this short history is anything to go by (and we were taking nothing more into account than this chart) then the spread could reach over 20% again.