Goldman Sachs forecasts that slumping commodity prices will rebound strongly in the next year as growth in demand from prospering emerging markets far outweighs the impact of the crisis in Western economies.
After the biggest quarterly decline in commodity prices since Lehman Brothers triggered a global meltdown in 2008, Goldman Sachs forecast that key manufacturing ingredients such as oil, aluminium, copper, nickel and zinc would jump in the coming months.
Analyst Jeffrie Currie said: "With recent GDP revisions by our economists falling hardest on Europe but emerging market growth expectations still relatively solid, we continue to believe that demand growth in 2012 will be sufficient to tighten major commodity markets."
Despite forecasting a rebound in prices in 12 months, Goldman cut its predictions on a range of commodities such as zinc, aluminium and nickel after the bank's economists cut their global growth forecast for next year to 3.5 per cent from 4.3 per cent.
Goldman reduced its 12-month forecast for Brent crude, which is trading around US$101 a barrel, by US$10 to US$120. It lowered its forecast for copper - down 28 per cent so far this year - by 15 per cent to US$6886.50 a tonne.
