2024-03-25 10:21:20 ET
U.S. investment bank %Gold manSachs (NYSE: ) is forecasting a rally in %Commodities this year as central banks in the U.S. and Europe lower interest rates.
Analysts at Goldman Sachs say lower rates will support industrial and consumer demand for commodities, spurring a rally in prices throughout this year’s second half and into 2025.
Specifically, raw materials may return 15% this year, said Goldman Sachs in a note to clients, with copper, aluminum, %Gold , and oil all likely to see price increases in coming months.
Already in 2024 commodities have made gains, with crude oil prices rising above $80 U.S. a barrel, gold hitting record levels, and copper above $9,000 U.S. per ton.
Goldman Sachs says commodities will continue advancing as both the U.S. Federal Reserve and European Central Bank lower interest rates.
Commodities are also likely to get a boost as the Chinese government provides greater support for its ailing economy.
In its note, Goldman Sachs made several year-end forecasts, including copper prices at $10,000 U.S. a ton, aluminum at $2,600 U.S. per ton, and gold at $2,300 U.S. an ounce.
However, Goldman said it remains bearish on the outlook for battery metals such as nickel, cobalt and %Lithium due to a slowdown in demand for %ElectricVehicles worldwide.
The U.S. central bank left interest rates unchanged last week but reiterated its expectation that it will cut interest rates three times this year.
Goldman Sachs’ stock has increased 28% over the last 12 months and currently trades at $406.82 U.S. per share.