Commodity markets have become a popular asset class for portfolio investors, just like stocks and bonds. Strategists at ANZ bank analyze commodities outlook.
Falling inventories point to market tightness
Commodity markets have been under pressure in recent time amid a weak economic backdrop. Despite this, there are signs of tightness.
Inventories have always been a good guide to demand; and after a shaky start to the year, are showing signs of tightness across most markets.
There has been a clear drawdown across commodity exchanges and the broader supply chain. However, the trends are more discrete across the energy market. Industrial metals are now at multi-decade low levels which could trigger price rallies amid supply shocks.
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