JP Morgan: Commodities Could Surge By Another 40%

JP Morgan: Commodities Could Surge By Another 40%

Commodities have room to soar by another 40 percent on top of the gains in recent months, as investors could pour more money into raw materials as a hedge against the highest inflation in 40 years, JPMorgan Chase & Co says.

“In the current juncture, where the need for inflation hedges is more elevated, it is conceivable to see longer-term commodity allocations eventually rising above 1% of total financial assets globally, surpassing the previous highs,” JPMorgan strategists led by Nikolaos Panigirtzoglou wrote in a note to clients this week, as carried by Bloomberg.

Higher money allocations to the commodities asset class “would imply another 30% to 40% upside for commodities from here,” all else being equal, JPMorgan noted.