Summary
Akhil Patel reviews the PSE commodities forecast curve in the context of Credit Suisse and SVB failures. The forecast curve called for a low in 2022 with a rise into 2027. Geopolitics (Ukraine war) distorted the timing, driving prices higher than expected before a fall. An important commodity low is expected in 2023, consistent with a Fed pivot and weaker dollar.
Key Claims
- The PSE commodity forecast curve projected a low around August 2020 and a rise into 2027. — confidence: high
- Ukraine war created a supply shock that pushed commodity prices above forecast in early 2022. — confidence: high
- An important commodity low is expected in 2023, to be the low for the decade. — confidence: high
- A weaker US dollar and Fed pivot are prerequisites for the commodity recovery. — confidence: high
- Banking failures (SVB, Credit Suisse) reflect poor management in a tight money environment, not systemic crisis. — confidence: high
- Equinox dates (around March 21) are watched for market direction clues. — confidence: high