El Niño nears record levels as Pacific waters continue to warm
BusinessLine 1 hr ago·29 Sept 2026, 11:33 am
El Niño conditions are intensifying as sea surface temperatures in the Pacific Ocean rise to near-record levels. This warming trend is expected to drive a positive Indian Ocean Dipole (IOD) during the Southern Hemisphere spring, a weather pattern that often follows El Niño.
For investors, this combination of weather events is a key macroeconomic risk. El Niño and a positive IOD can severely disrupt agricultural output, particularly for rain-fed crops, while also impacting commodity prices and global supply chains. These factors can lead to volatility in the broader market as investors adjust their outlook for earnings and inflation.
Investors should monitor weather reports closely and keep an eye on the performance of commodity-linked sectors. As the season progresses, watch for updates on crop yields and government policy responses, which will likely influence market sentiment.
Excerpt from BusinessLine
El Niño has strengthened to near-record levels, with the Nino3.4 index reaching 2.72°C during the week ending September 27, the second-highest level on record. Models show further warming through spring (October-November), with most models peaking above 3°C. A positive Indian Ocean Dipole is also likely to develop…Read the original at BusinessLine
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- Category: Economy.
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