Commodity market The price of gold bullion fell dramatically on 12 April 2013 and analysts frantically sought explanations. Rumors spread that the European Central Bank (ECB) would force Cyprus to sell its gold reserves in response to its financial crisis. Major banks such as Goldman Sachs began immediately to short gold bullion. Investors scrambled to liquidate their exchange-traded funds (ETFs) and margin call selling accelerated. George Gero, precious metals commodities expert at the Royal Bank of Canada (RBC) Wealth Management section reported that he had not seen selling of gold bullion as panicked as this in his forty years in commodity markets.
Commodity currency deflation. This can have negative or positive effects depending on whether the currency was overvalued or not, deflation can either be positive or negative in the long run as suggested by the effects section of the deflation article. It is important to note that while countries with commodity currencies benefit from the higher demand, countries that import this commodity face the opposite effects. Commodity currencies nature can allow foreign exchange traders to better gauge the value of a currency and predict the movements within the markets based on the perceived value of the commodity to which the currency is tied.