Oil market is sending a serious signal. After the price reached four-year high in the beginning of October, it already fell by more than 25%. According to Bloomberg, these are not just price fluctuations, which can be fixed through supply adjustments. This looks more like weakening demand, which is worrying. Especially, when it is accompanied by alarming data on slowdown in development of third and fourth world’s largest economies – Japan and Germany.

What worse is that reduction in oil demand is observed amid falling price of copper. This basic metal is considered to be a forecaster for peaks and declines in economic cycle, as it is used in many sectors from homes to energy production.

Weakening raw materials prices are result of two related factors. First, economics, showing impressive growth in 2017, started weakening. Except for the US. Euro area’s economy will most likely not be able to gather significant pace next year.

Second, commodities prices are under pressure of strengthening dollar. US Fed raised interest rates eight times since December 2015. ECB, for comparison, still holds it on crisis low level. Bank of Japan in addition to everything else continues buying assets.

Bloomberg Dollar Spot Index gained 8,6% since the mid-April. Further strengthening will put pressure on oil and copper prices.

Taking into account recent political development in the US, trade conflict with China might not be finished any time soon. Along with another tariffs hike in January it will make the situation worse for investors, reduce capital spending and hit growth.

This is why it might be reasonable for investors to switch from investments into equities, which will most likely suffer from lower economic growth, to high-grade fix income securities, experts of Bloomberg suggest.