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How interest rates will hit your commodity strategy
Rising interest rates and a higher dollar are going to be fundamental drivers of commodity prices in the second half of 2013. That's according to Ole Hansen, Saxo Bank's Head of Commodity Strategy. Gold, copper, aluminium... they've all posted steep losses this last quarter, so what's the outlook for the coming months?
JP Morgan has recently issued its first "overweight" call on commodities since 2010. But Hansen doesn't envisage a major bull run on these markets. A stronger dollar, he says, is going to cause headwinds for the sector.
Gold is still under pressure and that's likely to continue, according to Ole. The established ranges in oil should continue, he says, although geopolitical shocks could spark a price spike. And agriculture production is looking good thanks to favourable weather conditions but a record crop is going to depress prices.
01:39 minutes
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