Goldman Sachs Group Inc on Friday slashed its 2015 price forecasts for several base metals including copper and aluminium while raising its estimate for gold by $62 per ounce.
“The primary reason for the changes to our forecasts is cost deflation – driven by a combination of actual and anticipated US dollar strength, cheaper energy and other input costs, and our expectation of an improvement in mining productivity,” Goldman Sachs said.
Goldman cut its 2015 average copper price forecast to $5,542 per tonne from $6,400, and aluminium to $1,788 per tonne from $2,075.
The bank slashed its 2015 average price view for lead to $1,838 per tonne from $2,350, nickel to $16,550 a tonne from $17,500, and zinc to $2,138 per tonne from $2,425.
The investment bank expects nickel, zinc and palladium to substantially outperform copper in 2015.
Goldman increased its 2015 average price forecast for gold to $1,262 per ounce from $1,200, saying the downward trend for prices since mid-2013 has been well short of its expectations.
Goldman expects gold prices to resume declining in the third quarter, in line with the start of the expected hike in interest rates by the US Federal Reserve.
Goldman slashed its 2016 average gold price outlook to $1,089 per ounce from $1,200.
For platinum, the bank decreased its 2015 average price estimate to $1,250 per ounce from $1,381. There could be more downside pressure on platinum with continuing strength in the US dollar and further downside in the South African rand. South Africa is a major producer of platinum.
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