In February this year, the Bloomberg Commodity Spot index hit record highs due to Russia’s invasion of Ukraine. Today, industrial-metal prices are down by 30% from their peak, according to the S&P GSCI All Metals index. The surging US dollar has depressed the prices of all the metals that are quoted in it. The main reason for the dollar’s strength has been interest-rate increases by the US Federal Reserve to combat inflation. This has caused fears of a nasty recession.
However, the greenback will eventually drop when the Fed begins to cut interest rates. We cannot know exactly when this will happen, but we can be prepared. When metal prices rally, they could bounce back very quickly. In this article, we look at two candidates for the next major rebound in metals prices.
“The renewable-energy sector will need aluminium for solar panels and to replace copper cables”
