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Citibank says commodities are set for a ‘period of outperformance’

  • Citibank is bullish on the outlook for commodities, mirroring similar sentiment from Macquarie Bank
  • Citi has made several upgrades to its forecasts for industrials, precious metals and the bulks
  • It says lower mining sector investment in recent years should help to support prices, especially for industrial metals

The global economy is looking better than at any point in the past decade growth picking up and inflationary pressures building.

And given that both stocks and bonds are looking expensive, and an expectation that the US dollar will continue to weaken, Macquarie Bank thinks now’s the time to buy commodities.

They’re not the only one saying that.

Citibank, too, thinks that commodities look like a good bet right now.

“All else equal, commodities should be in a period of outperformance given global conditions,” Citi says in a note released this week.

“The current macro backdrop of strong, synchronised global growth, weaker dollar and rising inflation as very positive for the commodities complex.”

So what commodities does Citi like at present?

In short, industrial metals, precious metals and the bulks, says Citi, making a swathe of upgrades to it previous price forecasts.

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.