Commodity price swings aren't all about China's weaker demand; the U.S. could move the market upwards as its taste for commodities returns, one expert predicts.
Upbeat data from the US suggest the possibility of an Federal Reserve interest rate hike soon, which would be a boon for commodities, Invast Australia's director of research, Peter Fay, said.
"There are other countries that can come out and add to demand, it's not just China," Fay told CNBC's Squawk Box on Tuesday.
The U.S. Bureau of Labor Statistics reported Friday that nonfarm payrolls grew 271,000 for October, a sharp jump from weak August and September numbers.
The positive numbers point to a possible rise in interest rates when the Fed meets next month.
Federal Reserve Chair Janet Yellen had said last week that December would be a "live possibility" for a rate hike if the upcoming data were supportive.
Fay said any rise in U.S. rates would be a positive for commodities as the main headwind for commodities prices has been the strength of the dollar against other major currencies.
Commodity prices tend to rise when the Dollar Index rises, as most products are traded in the greenback
Conventional wisdom is that the dollar gains on U.S. rate hikes. But Fay said historical data showed this was not the case after the first rate rise in a cycle.
"If you look historically, after the first rate rise the dollar index actually drops; this has been the case for the last seven, eight years so we think there might be some drop in the dollar index and this should lead to possibly some increase in (commodity) prices," he added.