Written Commentary
PRECIOUS METALS
Gold: August gold contracts moved higher, trading near $4,150, as traders took advantage of a marginally weaker dollar. However, underlying fundamentals remain bearish for gold as recent US-Iran strikes reinforce a hawkish inflationary backdrop, while Fed rate expectations have moved higher in recent days. The upside in gold today is likely stemming from dip-buying and technical signals. A Reuters poll showed that economists are expecting the Fed to keep rates on hold for the remainder of the year, while a majority of those who answered a separate question about the chance of a rate hike this year now described the likelihood as “high”, a reversal from last month when most saw it as “low.” Markets are pricing in a October rate hike and see 41 bps of tightening before year end.
Silver: September contracts are up 2.3% to $60.50.
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BASE METALS
Copper: Copper prices were little changed on the LME after hitting a six-week high on Tuesday. Low inventory outside the US have lifted prices, though the $14,000 level has been acting as strong resistance for Chinese buyers. Meanwhile, the dollar’s recent strength and a pickup in oil prices acted as a headwind overnight. Broadly, smelter maintenance and stockpiling due are weighing on warehouse supply in China, while the scrap market remains tight due to demand for copper cathode. The Yangshan copper premium, a gauge of import demand, hit close to a four-year high earlier at $115 a ton. Copper stocks in SHFE-monitored warehouses have declined by 82% since May; copper in LME-registered warehouses are down by 28% in the same period, with much of the LME material moving to the US. The premium paid over SHFE prices to buy copper in the spot market is up to 435 yuan a ton from zero last week and the highest since May of 2025. Tariff anxiety is helping to fuel the recent advance in prices, while concerns over sulphuric acid availability have reinforced supply worries outside of tariff dynamics.
Zinc: Zinc advanced 0.8% to $3,582.
Aluminum: Aluminum gained 0.8% to $3,183.
Tin: Tin was up 0.3% at $54,050.
Lead: Lead added 0.8% to $1,874.
Nickel: Nickel rose 0.3% to $17,130.
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