Written Commentary
GOLD
Gold futures advanced to a new all-time high, fueled by safe-haven demand following U.S. President Donald Trump’s announcement of new global tariffs on all steel and aluminum imports, which heightened concerns over a potential trade war.
This move builds on existing metal tariffs as part of his broader trade policy overhaul. Gold futures have advanced despite a more cautious Federal Reserve outlook on interest rate policies this year as the central bank will lower its key rate only one time this year, probably at its June 18 policy meeting. Despite a Federal Reserve that is likely to be slower to move to more accommodation, other central banks are on track to more aggressively lowering key interest rates, such as the European Central Bank and the Bank of England.
In addition, central bank demand for gold remains strong, with the People’s Bank of China adding to its reserves for a third consecutive month in January, according to official data.
SILVER
March silver futures are higher, recovering some of the previous session’s losses as tariff warnings from U.S. President Donald Trump resulted in increased safe-haven demand for precious metals.
President Donald Trump revealed plans for a 25% tariff on all steel and aluminum imports, scheduled to take effect later today, with additional tariffs expected to be announced on Tuesday or Wednesday. This move came as China announced retaliatory tariffs on selected U.S. exports, also set to take effect today.
German Chancellor Olaf Scholz stated that the EU is prepared to respond “within an hour” if the U.S. imposes tariffs on European goods. Silver prices have been further supported by expectations of stronger industrial demand, in the renewable energy sector and forecasts of ongoing supply shortages. Recently, the Silver Institute predicted a fifth consecutive year of substantial market deficits in 2025, driven by strong industrial demand and retail investment, which are expected to offset weaker consumption in jewelry and silverware.
COPPER
Copper futures advanced due to strong market fundamentals. Concerns are growing about tighter supplies from Chile, which is the world’s leading copper producer, as repairs and aging mines are causing production delays. Chinese demand has increased following the Lunar New Year celebrations, and U.S. demand remains strong as buyers stock up ahead of possible tariffs. However, investors are remaining cautious after President Donald Trump revealed plans for a blanket 25% tariff on all steel and aluminum imports, effective later today, with further tariffs expected on Tuesday or Wednesday. This announcement comes as China’s retaliatory tariffs on certain U.S. exports are set to take effect.
Prospects of easier credit conditions from most of the world’s major central banks have underpinned the copper market.
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