Goldman predicts new boom for commodities
Wednesday 05 October 2011
Goldman Sachs forecast that slumping commodity prices would rebound strongly in the next year as growth in demand from prospering emerging markets far outweighed the impact of the crisis in Western economies.
After the biggest quarterly decline in commodity prices since Lehman Brothers triggered a global meltdown in 2008, Goldman Sachs forecast that key manufacturing ingredients such as oil, aluminium, copper, nickel and zinc would jump in the coming months.
Jeffrie Currie, an analyst at Goldman Sachs, said: "With recent GDP revisions by our economists falling hardest on Europe but emerging market growth expectations still relatively solid, we continue to believe that demand growth in 2012 will be sufficient to tighten major commodity markets."
Despite forecasting a rebound in prices in 12 months time, Goldman cut its predictions on a range of commodities such as zinc, aluminium and nickel after the bank's economists cut their global growth forecast for next year to 3.5 per cent from 4.3 per cent.
Goldman reduced its 12-month forecast for Brent crude, which is currently trading around $101 a barrel, by $10 to $120. Meanwhile, it lowered its forecast for copper – down 28 per cent so far this year – by 15 per cent to $6,886.50 a tonne.
The S&P GSCI enhanced commodity index of 24 key industrial and precious metals and staple foods fell by 14 per cent in the three months to 30 September, leaving it down nearly 8 per cent on the year.
Industrial metal prices are down nearly 24 per cent this year, as optimism about a strengthening economy gave way to concerns about the the debt crisis in the West.
- 1 Raif Badawi, the Saudi Arabian blogger sentenced to 1,000 lashes, may now face death penalty
- 2 PornHub turns masturbation into energy in bid to save the planet
- 3 Robert Mugabe eats a zoo for 'obscene' 91st birthday party
- 4 The remarkable archaeological underwater discovery that could open up a new chapter in the study of European and British prehistory
- 5 The jihadi girls who went to Syria weren't just radicalised by Isis — they were groomed
End of the licence fee: BBC to back radical overhaul of how the Corporation is funded
Stephen Hawking's wife Jane Wilde on their marriage breakdown: 'The family were left behind'
Raif Badawi, the Saudi Arabian blogger sentenced to 1,000 lashes, may now face death penalty
PornHub turns masturbation into energy in bid to save the planet
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’
New theory could prove how life began and disprove God
This is what it's like to be dead, according to a guy who died for a bit
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
Ukip would cut billions from Scottish budget to fund English tax cuts
Russia's roadmap for annexing eastern Ukraine 'leaked from Vladimir Putin's office'
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
iJobs Money & Business
£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...
£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...
£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...
£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...