This article was originally published here
About Sci Pollut Res Int. 2022 Apr 15. doi: 10.1007/s11356-022-19328-2. Online ahead of print.
As a result of the COVID-19 pandemic outbreak, most commodities experienced significant price declines, which were expected to continue through 2020. Accordingly, the Markov switch model is used to study the influence of political uncertainty and the COVID-19 pandemic on commodity prices in the United States. Commodity markets are driven by economic policy uncertainty, according to results from a two-state Markov switch model. In both high and low regimes, economic policy uncertainty (EPU) influences the commodity market, according to the study’s findings. However, at high rpm, the UPR has a greater influence on the energy and metals sectors. According to this study, UPE has different influences on commodity markets in high and low volatility regimes. There is a wide range of correlations between COVID-19 outcomes and the UPR and how the prices of natural gas, oil, corn, silver, soybeans, copper, gold and of steel react to these shocks, in the high and low volatility regimes. . Oil and natural gas, on the other hand, are unaffected by changes in COVID-19-related death rates under either regime. The results show that in both high and low volatility regimes, demand and supply for most commodities respond to historical prices.