Commodities as an asset class gained in 2020 on the back of a weak US dollar that declined 6.5 percent and supply disruptions due to COVID-19 led lockdown and higher cases in production areas.
The easy liquidity in the markets due to massive stimulus from global central banks also led to long speculative positions build on strong fundamentals.
Now as the lockdown restrictions ease, travel and consumption increases and there is vaccine optimism, should one hold commodity longs in one's portfolio for 2021?
To discuss this CNBC-TV18’s Manisha Gupta talked to Naveen Mathur, director- commodities at Anand Rathi, Kunal Shah, Head of Commodities at Nirmal Bang Commodities, and T Gnanasekar, director at Commtrendz Research.
On gold, Kunal Shah said, “We have seen a phenomenon returns coming out of gold this 2020. Going forward in 2021 my view continues to remain bullish from the broader perspective for 2021. In the near term, gold and silver may not be able to give any major spike or major returns. But on the decline, I recommend to accumulate.”
“Gold conservatively on MCX should hit 55,000-56,000 going forward in 2021 which is currently trading at Rs 50,000.”
On silver, T Gnanasekar said, “It is one of my top picks for 2021, if you look at the overall dynamics for the silver market at this point in time everything is pointing towards major upside in the coming year. We are looking at clearly anything in the range of USD 45 or possibly going above that.”
Watch this interview for more.