Goldman Sachs Sees Structural Bull Market for Commodities

Goldman Sachs forecasts a structural bull market in commodities, expecting a 28% return over the next year. This is driven by shrinking inventories, supply deficits, and macroeconomic factors like a weaker dollar and global monetary policies. Supply shortages arise from various reasons, including structural changes and unrelated factors. The discussion also covers inflation hedges and bond market dynamics, with a focus on specific commodities like soy and natural gas, which face significant deficits. Macro tailwinds, such as rising inflation risks, are expected to offset potential demand shocks from COVID-19.

What is the expected return on commodities over the next 12 months according to Goldman Sachs?

• 50%

• 35%

• 28%

• 15%

Which factor is NOT mentioned as influencing the supply shortages in commodities?

• Pandemic-related structural changes

• Unrelated factors

• Inflation hedges

• Technological advancements

How do commodities act in the context of inflation?

• As inflation reducers

• As inflation neutral

• As inflation drivers

• As inflation hedges

Which macroeconomic factor is expected to offset demand shocks in the commodity market?

• Stronger dollar

• Rising inflation risks

• Stable oil prices

• Decreasing interest rates

Which commodities are highlighted for their significant deficits in the coming year?

• Wheat and corn

• Copper and aluminum

• Soy and natural gas

• Gold and silver