2014 was the fourth successive year of poor performance by commodities, especially relative to bonds and equities, but we believe 2015 will be the year when many finally turn the corner. The recent slump in oil prices was a long overdue correction that should boost the world economy and ultimately be seen as a positive for other industrial commodities. The prices of agriculturals may still be depressed by ample supply, while precious metals could be particularly vulnerable to earlier Fed tightening. But the dollar has already strengthened a long way and US interest rates are only likely to rise gradually. We therefore expect gold prices to recover too, and silver to outperform again.
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