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Big swing in global growth is bullish for commodities: VanEck CEO

by SuperiorInvest

Investors should consider commodities because of a “big shift” involving international expansion, according to Jan van Eck, CEO of VanEck.

“The global economy has started growing again,” van Eck told CNBC's “ETF Edge” this week.

He points to China, the world's second-largest economy behind the United States, as a key driver of the expansion.

“China, which has been a big driver of growth and so negative for growth over the last year or two. The manufacturing PMI is now positive in China in March,” van Eck said. “Now there is growth… So, that leads to reflation.”

His company has exposure to commodities, from gold to energy and copper. Its exchange-traded funds include the VanEck Gold Miners ETF (GDX) and VanEck Oil Refineries ETF (CRAK). They have increased 10% and 9%, respectively, so far this year.

Van Eck Highlights copperThe momentum is a positive sign for demand. The industrial metal is up almost 16% this year, as of Friday's close.

“It is a good measure of global economic growth and energy prices. [They] They are probably a little ahead of themselves, but they are reflecting that the world is growing,” he said.

He also sees US government spending as a bullish catalyst for commodity trading.

“Tax spending is increasing a lot,” van Eck said. “That's also leading to this global growth trade. That's why I like commodities because I think it's more than just a headline.”

At the close of Friday, the S&P GSCI Spot Indexthat tracks commodities Raw oil to cocoaIt is up 10% so far this year.

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