Favor commodities in Commodity News 01/03/2026 Commodity price leadership has shifted from precious metals to energy, underlining the value of an active and diversified allocation. We see further upside for broad commodities in 2026, with returns driven by a combination of supply-demand imbalances, geopolitical risks, and long-term trends. For investors with substantial allocations and significant unrealized profits in gold, broadening commodity exposure can help diversify sources of future return. We continue to favor an active approach to commodity exposure. Broad commodities Commodity price leadership has shifted from precious metals to energy, underlining the value of an active and diversified commodity allocation. We see further upside for commodities overall in 2026, with returns driven by a combination of supply-demand imbalances, geopolitical risks, and long-term trends. For investors with substantial allocations and significant unrealized profits in gold, broadening commodity exposure can help diversify sources of future return. We continue to prefer an active approach to commodity exposure. Precious metals Gold has regained its poise after its steepest decline in 13 years on 30 January. The rebound has reflected political, geopolitical, and economic uncertainties, which continue to drive safe-haven demand. We see scope for prices to move higher, with lower real yields and fears over rising global debt levels underpinning continued gold demand from central banks and investors. For those with an affinity for gold, we believe a mid-single-digit allocation remains appropriate in a balanced USD portfolio. Our base case is for gold to rise to USD 6,200/oz over the coming months, before ending the year around USD 5,900/oz. Silver, meanwhile, should benefit from higher gold prices and tighter near-term fundamentals. Energy Brent crude has had its best start to a year since 2022. Oil prices have been supported by three main factors. First, cold weather in the US in January led to production shut-ins, lowered crude production, and lifted energy demand. Second, disruptions in Russia and Kazakhstan were also supportive of prices, with drone attacks impacting Russian production and lowering the exports from the Caspian Petroleum Consortium export terminal. Lastly, tensions in the Middle East and concerns of supply disruptions have seen market participants adding a modest risk premium to prices, although crude exports from the region have not yet been disrupted and Iranian crude exports remain high. We anticipate a modest price setback over the coming weeks, absent an escalation of tensions in the Middle East that leads to supply disruptions. A gradual fading of the risk premium and easing supply disruptions resulting in a better-supplied market should bring Brent back into the USD 60-70/bbl range, in our view. We set our new end-March 2027 Brent forecast at USD 67/bbl and now see a wider WTI to Brent discount of USD 4/bbl (from USD 3/bbl before). Industrial metals We believe supply disruptions and structural demand should continue to offset weaker manufacturing data in China and shield metal prices from larger pullbacks. We believe sector-specific factors will support well-bid prices in the coming quarters. The copper price has pulled back from the record high set in late January. Nevertheless, our latest balance forecasts point to a widening market deficit of 520,000 metric tons in 2026, compared with a deficit of 203,000 metric tons in 2