Commodity markets on the upswing: optimistic outlook for 2024
Commodity markets on the upswing: optimistic outlook for 2024

26 March 2024 – The analysts at Goldman Sachs recently reaffirmed their optimistic outlook for commodities in 2024 and see rising commodity prices on the horizon. And the German ifo business climate index has risen to its highest level since June 2023, with sentiment in the manufacturing sector improving significantly.

Commodity markets on the upswing: optimistic outlook for 2024

Goldman Sachs Group Inc. expects commodity prices to rise by up to 15% in 2024. The optimistic outlook is based, among other things, on the fact that the central banks in the United States and the European Union are expected to cut interest rates this year. This should boost both industrial and consumer demand.

Initial gains and positive signals

Commodities such as crude oil, gold – which reached a record high – and copper already showed a positive trend in the first quarter at over USD 9,000 per tonne. The announcements by the US Federal Reserve and the European Central Bank to lower interest rates and additional support measures by China for the domestic economy are reinforcing this trend.

Long-term outlook: Stronger signals expected

The analysts at Goldman Sachs see the greatest potential in metals in particular, especially copper and gold, as well as crude oil. They emphasise that the positive effect on prices will increase over time as the growth impetus is passed on by the loose financial conditions.

Global outlook: A new cyclical upswing

Other market observers share this optimistic outlook. Both Macquarie Group Ltd. and the Carlyle Group LP have expressed a positive outlook for commodity prices in 2024.

Optimism in the German economy: ifo business climate index rises

In March, the ifo Business Climate Index reached 87.8 points, its highest value since June 2023. A positive correction of the February value to 85.7 points underlines the upward trend. The increase is reflected positively in all sectors of the economy.

Situation assessment and future prospects: Above expectations

Not only the current situation, but also expectations for the future are brightening considerably. The index for business expectations surprised analysts with a sharp rise.

Manufacturing industry noticeably more satisfied and with rising expectations

The business climate in the manufacturing industry in Germany has improved markedly. Companies were noticeably more satisfied with current business. In addition, the expectations indicator for new orders rose significantly.

Signs from the German economy point to recovery

Signs from the German economy, which has been struggling with high energy prices, a chaotic red-green economic policy and rising interest rates, are now pointing to recovery.

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