Credit Suisse Group AG : Commodity Markets Lower In December, Yet Fundamentals For Key Commodities Remain Strong

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Media Release Commodity Markets Lower In December, Yet Fundamentals For Key Commodities Remain Strong New York, January 12, 2012 - Commodities were lower in December as macroeconomic sentiment continued to weigh on risky assets and supported a stronger US dollar.

Nelson Louie, Global Head of Commodities in Credit Suisse's Asset Management division, said, "Commodities were lower in December, ending an already volatile fourth quarter. Broad-based commodities indices essentially traded sideways in an extremely volatile range, as investors continuously re-evaluated the European debt crisis' potential impact on the global economy. Despite these headwinds, the global manufacturing PMI actually improved in December. We believe this may reflect underlying strength in the US and key emerging markets."
Christopher Burton, Senior Portfolio Manager for the Credit Suisse Total Commodity Return Strategy, added, "Fundamentals for key commodities largely remain supportive, with generally tight inventory levels and continued strong demand. The threat of supply shocks is particularly acute for the crude complex and Agriculture. While Precious Metals have lost their luster of late, demand for currency alternatives and hard assets is likely to remain strong amid continued loose monetary policies. We believe investors may derive long-term diversification benefits in conjunction with potential inflation protection through a strategic allocation to commodities."
The Dow Jones-UBS Commodity Index Total Return was down by 3.75% in December. Overall, 12 out of 19 index constituents decreased in value. Precious Metals was the worst performing sector, down
11.44% for the month, as a result of strong demand for US dollars, eroding demand for currency
alternatives. Energy ended the month down 5.58%, as Natural Gas weighed on the sector. Warmer- than-normal temperatures for the start of the heating season in the US increased expectations for increasingly bloated inventory levels. Industrial Metals were also lower, losing 4.25%, in response to the potential impact of macroeconomic headwinds on Chinese demand. Livestock was also lower, down

4.04% for the month, despite the release of the USDA's November Cold Storage Report which revealed the lowest level of frozen meat and poultry inventories since 2003. Agriculture was the best performing sector, up 4.03% for the month, supported by hot and dry weather in Argentina and Brazil during the critical pollination period.

The Credit Suisse Total Commodity Return Strategy group periodically produces updates on relevant industry topics. For a copy of the team's white paper, "Commodities Outlook: Increased Volatility, Increase Opportunity?", please contact your Credit Suisse Relationship Manager.

About the Credit Suisse Total Commodity Return Strategy

Credit Suisse's Total Commodity Return Strategy has been managed for 17 years and seeks to outperform the return of a commodities index, such as the Dow Jones-UBS Commodity Index Total

Media Release

January 12, 2012

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Return or the S&P GSCI Total Return Index, using both a quantitative and qualitative commodity research process. Commodity index total returns are achieved through: