Many industrial commodities' prices, including base metals and oil, seem to be finding a floor, based on the day-to-day volatility. This is consistent with the relative positive outlook for the remainder of 2016. However, there are no firm conclusions regarding the state of demand. Indeed, oil prices are declining again now, partially because of unhelpful comments from OPEC officials.

Saudi Arabia has stressed that any freeze in the output will be an alternative to absolute cuts, whereas Iran has repeated that it plans to increase production and exports as sanctions are lifted. However, Brent has been above $30 per barrel, and for over four weeks. The rebound in industrial metals' prices is more striking, with iron ore and copper amongst those posting large amount of gains from their mid-January lows.

However, there are many factors involved here. The rebound in commodity prices has been impressive slightly due to the US dollar weakness, although many of the commodity prices are still above their lows when measured in terms of a currency basket. Moreover, the rebounds in prices are helped by the general improvement in global risk appetite, seen also in equity prices.

With the uncertainty in these markets, it is better to use caution against believing too much of what is just a brief period of firmer prices, particularly the distortions caused by the Chinese New Year. It is still in doubt whether the recovery in commodity prices is a reliable proof of a pick-up in demand.

According to business surveys, global manufacturing slowed down further in February. Moreover, steel output is also declining sharply, making it more wary regarding the recovery in iron ore prices. However, the relative resilience of several industrial commodity prices in the past weeks might help in tempting more investors back.

"We expect further recoveries over the rest of 2016 as markets tighten, with Brent heading for $45 per barrel and copper $5,500 per tonne", says Capital Economics.