Returns on investing in commodities will be boosted as central banks ease monetary policy and governments take steps to offset the impact of global trade disputes, Goldman Sachs said.

The investment bank said it was forecasting 3-month total commodity index returns of 10% for the S&P Goldman Sachs Index and 9% returns on a 12-month outlook. In March, it had forecast a 3-month return of 5.1% and a 12-month return of 2.8%. The longer term returns were seen as lower due expected growth in oil supply.

"Interest rates are lower and oil prices are weaker, all combining for easier financial conditions ... policymakers have demonstrated a willingness to underwrite any demand weakness stemming from trade war concerns," Goldman said.

"Combined with the sharp decline in the U.S. rates curve, subdued inflationary pressures stemming from lower commodity prices and a likely rollover of the current OPEC+ production deal, this sets the stage for a third quarter rally in investment, manufacturing and, from current discounted levels, commodity prices."