The US dollar gained on the euro after Fed chairman Ben Bernanke said the risk of a substantial downturn in the US economy had diminished and Treasury Secretary Henry Paulson said that he would never rule out currency intervention. As a consequence of stronger dollar, gold prices have been getting lower, mainly as gold has been seen as a hedge against inflation and weaker dollar.

After climbing nearly $11 on Friday, light crude oil fell to $135 after recovering some of the loss and climbing to $137. No single reason seems to be for the surge in price on Friday, but speculation about Morgan Stanley's comment that oil could reach $150 as early as July 4th, may have had some thing to do with it.

Even though the drop in commodity prices has been considerable some analysts claim that there might be some more to come. Some analysts expect commodity prices to drop 10 to 20 percent, but that the overall bullish trend in commodities will be intact and higher prices to follow. Any such drop would draw in new investors and fresh funds.

Most analysts point to the emerging middle classes of countries like India and China. These people are getting more and more demanding and the desire for luxury and better lifestyle has prompted the increased use of commodities, like oil and metals.

The euro strengthened against the dollar when Jean-Claude Trichet, the president of the European Central Bank indicated a rise in the interest rate later this year. With weaker dollar, commodity prices began to rise, with the price of oil passing $124.

The day after Ben Bernanke came out with a statement that confirmed rumors of end to lower interest rates, commodity prices continued to fall. With oil trading below $124 and other commodities trading lower, the rally in commodities could be in for a pause or even a pullback. Weak dollar having been given as a major reason for high commodity prices, the increased strength in the dollar might be about to change the bullish trend in commodities.

High commodity prices have spurred some talks within western governments to limit the effect of speculation on prices. The Austrian finance minister Wilhelm Molterer has said that he's going to propose a Europe wide tax on speculative commodity trading. The US senate has also started to look at speculation in commodity trading and is thought to be looking at ways to set limits on speculative trading.