Wheat futures fell nearly one percent in American trade as the dollar index rose according to their inverse relation, following earlier data from the U.S., the world's second largest wheat exporter, and ahead of the U.S. Department of Agriculture's report on grain stocks in the country.
As of 07:36 GMT, wheat futures due on July 15 fell 0.87% to $4.2975 a bushel from the opening of $4.3350, with an intraday low at $4.2850, and a high at $4.3450, while the dollar index rose 0.49% to 99.55 from the opening of 99.06.
According to a recent analysis by University of Illinois researchers, wheat prices across 200 years and inflationary pressures support the prospect of higher prices, as long-term inflation didn't have a noticeable impact on prices from the year 1800 to 1972, before changing in 1973, as modern inflation allowed grains to have a share in hedge investments.
It's true, that prices from 1800 to 1973 fluctuated between below $1 a bushel to over $2, but staying within the range most of the time, as the average prices in the nineteenth century were $1.82, while the average in 1972 was $1.57.
At the end of the Briton Woods system in 1973, and the severance of the gold-dollar relation, it allowed modern inflation to take shape and impact historical prices for assets and commodities, with wheat surging from $2.47 to $4.45 in a few months of 1973.
Prices then reached $4.78 by the end of 1973, and $5.52 by February, 1974, before falling in the next couple of year and wavering greatly, while never getting back to the old price range of before 1973.