As we head into 2022, that trend is definitely set to continue.
Last week, Goldman Sachs signalled in their latest report that “the best place to be in 2022 is commodities” – forecasting huge gains ahead for the entire sector amid a supercycle that has the potential to last for a decade.
There are plenty of reasons why a long list of Wall Street banks are “extremely bullish” on commodities. These include rapidly surging global inflation, tightening supply vs soaring demand, logistical bottlenecks to ever growing supply chain issues – all combined with a very disruptive economic recovery from the pandemic that shows no signs of fading anytime soon.
The previous two supercycles took place in the 1970s and the 2000s. In both cases, the commodities sector resembled the identical tell-tale signs, as it’s displaying again right now.
If history is anything to go by, then the stage is almost certainty set for commodity prices to skyrocket and reach new all-time highs in the months ahead.
Looking ahead, the major macro event that traders will be watching closely this week for clues on the markets next big move will be U.S Consumer Price Inflation data. The reading is expected to show a record gain of 7%, which would be the largest year-over-year jump in consumer inflation in over 40 years.
Also on the radar will be Producer Price Inflation data as well as Fed Chair Jerome Powell’s nomination hearing before U.S. Senate Banking Committee, which always has the potential to move the markets significantly.
Where are prices heading next? Watch The Commodity Report now, for my latest price forecasts and predictions:
For a look at all of today’s economic events, check out our economic calendar.