As crude oil prices collapse below $30 per barrel and metals trade near record lows, Goldman Sachs forecasts that 2016 will nonetheless bring a "new bull market" for commodities.
The investment bank predicted that commodity producers this year would finally make the cuts needed to bring supply and demand back into balance. This would be helped by the globalisation and increasing liquidity of commodity markets, which will mean surplus production will be absorbed more easily than at present.
"The key theme for 2016 will be real fundamental adjustments that can rebalnce markets to create the birth of a new bull market, which we still see happening in late 2016," Goldman Sachs analysts led by Jeffrey Currie said in a report today.
Commodities are under pressure today with Oil leading the way lower as Brent and WTI are both currently lower by approximately 5%.
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