US wheat prices hit fresh record

US spring wheat closed up 25 per cent last night after hitting all-time highs of $25 a bushel as funds flowed into commodities…

US spring wheat closed up 25 per cent last night after hitting all-time highs of $25 a bushel as funds flowed into commodities to profit from rising inflation.

US cocoa closed at 24-year highs and arabica coffee at 10-year peaks. Oil also settled up, just under $100 a barrel.

The Reuters-Jefferies CRB Index, which tracks prices of 24 commodity futures, scaled 400 points for a seventh straight record session.

Analysts have worried that soaring commodity prices may push up prices of essentials such as bread, beverages and gasoline, prompting a surge in headline inflation.

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Some economists think the US Federal Reserve should end its five-month campaign of cutting interest rates to prevent the world's largest economy from slipping into recession.

But a senior Fed official said last night policy-makers were more concerned about core inflation, which excludes often volatile food and energy prices.