Markets are increasingly worried about inflation returning as a result of historic fiscal spending and continued low interest rates, which the bank says will likely drive more investment in commodities.
Gold bullion bars are pictured after being inspected and polished at the ABC Refinery in Sydney on August 5, 2020.Goldman Sachs is forecasting a bull market for commodities in 2021 based on its outlook for a weaker dollar, inflation, and the prospect of further economic and fiscal stimulus. The bank sees upside ahead particularly in non-energy commodities like agriculture and metals, citing tightening supply amid adverse weather conditions and greater demand from China. Economic stimulus measures in the world's second-largest economy have helped to drive demand for metals to its highest level since 2011.
Agreed.