Commodities: Weaker Dollar lacks growth catalyst – BNY
Geoff Yu at BNY says a less hawkish Fed has weakened the Dollar, but this has not translated into a broad commodity rally. Institutional investors remain sellers of metals and miners, while EM commodity sovereign debt continues to struggle and commodity FX buying has faded.
BNY analyst Geoff Yu notes that while a less hawkish Fed has weakened the dollar, this has not sparked a broad commodity rally. Institutional investors continue to sell metals and mining stocks, and emerging market commodity sovereign debt remains in trouble. The necessary growth catalyst is lacking: without robust global demand, especially from China, lower U.S. real yields alone are insufficient to sustain commodity-linked assets.
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