Commodities 2011: Five themes to
drive the markets this year

In this outlook for 2011, we outline five themes to drive commodity markets in 2011. We have revised our 2011 forecasts for oil a little higher and introduce mildly bullish 2012 projections for most products. Key themes are as follows:

• Theme #1: Market balances to tighten further, shifting forward curves towards backwardation.
• Theme #2: Pricing of a restart of a decade-long commodities super-cycle on top of businesscycle fluctuations.
• Theme #3: Risk of commodities decoupling from the dollar - not least if euro debt woes continue.
• Theme #4: Degree and pace of policy tightening in emerging markets on both the monetary and fiscal side.
• Theme #5: Introduction of new physically-backed base-metal ETFs and regulatory responses.

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