Editor’s Note: The headline has been revised to accurately attribute the quote “the future could be different” to BofA analyst Francisco Blanch.
The four most dangerous words in finance are: “this time it’s different,” as renowed investor Sir John Templeton once said. Yet, Bank of America believes that for commodities, the tide is now changing for the better.
For years, commodities haven’t been the go-to for investors, given lackluster returns, but Bank of America commodities strategist Francisco Blanch has some good news: commodities are back, and they are poised to reclaim their rightful place in investors’ portfolios.
With reasons such as thin inventories, ample spare capacity, sticky inflation, and significant moves towards clean energy, things are looking bright for the asset class. Blanch puts it simply: “the future could be different for commodities” after a long 15 years of not much happening.
Chart: Commodities Weakened After A Major Pandemic-Related Rally
The Changing Tide: ‘This Time Is Different’ For Commodities
With global nominal GDP growth expanding robustly and expectations of a U.S. soft landing materializing, the backdrop appears increasingly favorable for raw materials.
Blanch foresees that structural shifts in demographics and consumption patterns are anticipated to sustain inflation ...Full story available on Benzinga.com
Related tickers: GLD, CMDY.
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