Commodities may dip but rebound later - analysts
miningweekly.com
By: Reuters
2nd June 2009
LONDON - Commodity prices are showing signs of recovery and while there may be a temporary dip, the rebound is expected to continue later this year, the majority of speakers said at the start of a mining conference on Tuesday.
"April was the bottom for commodity prices in the cyclical downturn," said Patricia Mohr, economics and commodities markets specialist at Scotiabank Group, noting that prices have since been boosted by Chinese demand. However, "copper and iron ore buying will slow down and we may see some ebb in the summer."
Speaking at the World Mining Investment Congress she forecast copper prices at $1,85 per lb in 2009 and $1,95 in 2010 and expects the metal to outperform other base metals in those years.
A Reuters poll in January predicted an average 2009 price of $1,55 per lb, rising to $1,95 in 2010.
Frank Holmes, Chief Executive of US Global Investors, is positive on gold as low interest rates make the metal an attractive asset.
"Gold in the short period could easily correct, but in the longer term governments will do everything to print the money and gold will slowly become an important asset class worldwide," he said.
"Higher interest rates would pose a risk to gold, but higher interest rates aren't going to happen. If you are not long, you are going to be wrong on gold." |
