Commodity prices 'could rise as much as 20%'

Commodity prices could rise by as much as 20% in the second half of 2012 while forecasts for falls in mining stocks are overdone, according to Credit Suisse.

It said the consensus view on growth in demand from the US and China is 'overly bearish' and it expects global demand for commodities to strengthen through 2012 led by these two countries. Credit Suisse believes commodity prices troughed in the fourth quarter of last year and it is now looking for a further 5% to 20% upside in the second half of 2012, the Telegraph reports. However, Credit Suisse thinks miners could be subject to higher costs than expected, so it has reduced earnings forecast for the mining giants by between 5% and 16%. This means the broker is now between 5% and 10%...