Commodity markets seem to believe US President-elect Trump will quickly deliver the one thing that he probably can’t – a surge in infrastructure spending – and are ignoring all the bad stuff that perhaps he can. Trump’s promises are, in any event, small beer compared to the $200bn that we estimate China spent on infrastructure in the first nine months of this year alone. We therefore expect the recent gains in the prices of industrial metals to be short-lived and gold to rally again.
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