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Blokland’s daily sketch

Blokland’s daily sketch

07-05-2021 | Daily sketch
Did Yellen and the Fed just make commodities even more attractive?
  • Jeroen Blokland
    Jeroen
    Blokland
    Portfolio Manager
First we had US Secretary of the Treasury Janet Yellen suggesting that bond yields might have to go up just a little bit, given strong GDP growth and increasing inflation. Then yesterday the Fed warned of potential significant declines in asset prices, should risk appetite fall. While asset prices can involve several asset classes, the Fed most likely meant equities. This begs the question: are Yellen and the Fed driving investors towards real assets like commodities? It could well be, especially since commodities seem to have hit the sweet spot for now. Massive amounts of stimulus aimed at the real economy, higher inflation which is perhaps not completely transitory, a green revolution that is commodity-intensive (many people tend to forget this), and supply chain issues popping up everywhere bode well for commodity prices. Stay overweight.
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As a senior portfolio manager I use charts to illustrate financial issues every day. I tweet my favorites as @jsblokland and was named 'one of the 50 most important people for investors to follow in 2018' by MarketWatch.
Previous editions of the daily sketch can be found on my personal financial markets blog. All graphics provided are collected from Bloomberg data and public websites. They do not always reflect my personal opinion and may also not necessarily reflect the opinion of Robeco. Please cite all references or quote the original source if replicating content.

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