More worried for next year: Rogers

In an interview, Rogers said he expects agriculture commodities to become a promising investment opportunity after a prolonged period as demand remains high and prices rise.

Rogers anticipates interest rates to climb further and expects a substantial decline in crude oil prices only after the end of the Ukraine war. Edited excerpts:

In the current environment of uncertainties, what investment strategy should investors follow?

You should only invest in what you know well. And it holds more importance in the current environment. One should remain cautious and careful in these uncertain times.

The banking crisis and contagion effects, high interest rates and inflation are key risks that are seen as a threat to equity markets. When do we expect some respite?

After a long period of a good time, some surprising turn of events can always happen and are never to be ruled out. Interest rates were low for long periods, and people were confident and excited in a low-interest-rate environment. With interest rates rising, we have seen the surprise.

Interest rates are likely to be peaking. What’s your view?

Interest rate hikes may slow down in the near term, but more may happen next year. Eventually, we are headed for higher interest rates. Inflation may remain elevated for a longer period.

How are emerging markets such as India currently placed?

India is a good market but has continued to rise for a long period of time. Would wait for more correction to invest in India. Have invested in China, Japan, and Uzbekistan, which have offered more value post-corrections.

But it is hard to find many opportunities in the current environment.

The US markets are rebounding after significant corrections. Is the worst behind, or may we see some more downside?

America has seen the longest period of the bull market in history and therefore is likely to have corrected. It was not cheap.

I am not worried about this year, but I am more worried about next year.

The recession is widely anticipated, and expectations are that it may hit by the year’s end. We may see more impact of the turn of the event during 2024.

What is your view on currencies? The dollar index, though volatile, has retreated from highs.

I have large investments in the US dollar. It is considered to be a safe haven in the current environment.

In any turmoil, the dollar strengthens. I am also unsure where else to put my money right now.

What is your view on commodities as an asset class?

Commodities remain the cheapest asset class. I have been looking at silver, gold etc., but I think agriculture is the better place to be in. Agriculture has not remained an investment option for long, but currently, it is. The demand is high. The prices have been rising and so on.

What’s your view on crude oil?

It is the Ukraine war that remains the most important factor impacting crude oil prices. It is only when the Ukraine war subsides that you can expect a substantial decline in crude oil prices or a sustainable decline. I am also waiting for investments in crude oil but at lower levels.

What is your opinion about other base metals? Copper is volatile but has corrected significantly, and so have other metals.

With the rise in demand for electric vehicles, one expects lithium demand to remain high. But the rise in electric vehicles will also lead to higher demand for copper and lead. Copper and lead, too, can be considered for investments.