Written Commentary
COPPER
After three days of declines March copper futures are higher today after President Donald Trump hinted that a new trade agreement with China, the world’s leading copper consumer, could be achievable. Geopolitical tensions also provided support for metal prices, as European Union officials reached an agreement to ban Russian primary aluminum imports as part of a larger sanctions agreement.
In China, authorities have imposed restrictions on copper smelting due to an oversupply in the industry.
Prospects of a Federal Reserve that is likely to be slow to move to additional accommodation is seen as a headwind to higher prices for industrial metals.
GOLD
April gold futures advanced to a new all-time high as safe-haven demand surged in light of global uncertainties. Futures advanced despite yesterday’s release of the minutes from the Federal Open Market Committee’s January 29 policy meeting, which showed policymakers are in no hurry to lower interest rates further.
Central bank demand for gold remains strong.
SILVER
March silver futures are higher, recovering from losses in the previous session as increasing trade and geopolitical uncertainties increased demand for safe-haven metals. Earlier this week, President Donald Trump revealed plans to impose a 25% tariff on imports of automobiles, semiconductors and pharmaceuticals, which reignited fears of a global trade conflict.
Recent price gains for silver are linked to strong industrial demand from the electrification and manufacturing sectors. Also, there were recent reports that showed China added 357 gigawatts of solar and wind power in 2024, which increased industrial silver consumption.
In addition, traders are monitoring U.S.-led efforts to mediate the war in Ukraine, which could reduce the need for safe-haven assets such as silver.
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