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Macquarie Bank: Buy Commodities, USD Selloff Just Getting Started

Business Insider Australia  ( Original )
FEB 23, 2018

Gold and silver are set to take center stage as commodities will enter a cyclical bull market, according to Australia’s Macquarie Bank.

Ric Deverell, Chief Economist at Macquarie, says “While bond prices are likely to fall in coming years, and equities are looking heavy, commodity prices have already had their bust with the moderation in the China-led Super Cycle, with most now back around longer-run averages.

While much of the focus is on the benefits of precious metals as an inflation hedge, gradually increasing inflation is also supportive for the industrial commodity complex, with commodities often the source of near-term inflation, thereby providing an effective hedge.”

As for the risks posed by weakness in stocks and bonds spreading to the commodities complex, Deverell notes there’s been very little correlation between either stocks or bonds to commodity prices over the past 15 years.

ORIGINAL SOURCE: Macquarie: 'Buy commodities' by David Scutt at Business Insider Australia on 2/22/18