Written Commentary
PRECIOUS METALS
Gold: Gold prices are sharply higher with April COMEX contacts up 2.4% to $4,799 as the ceasefire in Iran lowered inflationary fears and weakened the case for Fed tightening. Meanwhile, the dollar and bond yields dropped significantly, lowering the opportunity cost of holding gold, alongside an uptick in global risk sentiment. Markets are now pricing a 35% chance of a rate cut at December’s meeting, while inflation swaps have fallen from 3.2% to 2.9% in response to the ceasefire news. March’s inflation data is likely to show a sharp, energy-induced spike in prices, though if the ceasefire holds, it is likely the report will be discounted. Hawkish Fed expectations have been a factor that has been offering strong headwinds to gold prices and supporting dollar strength. A drawdown on these expectations would likely lead to an upside breakout in gold, though that is dependent upon the reopening of the Strait.
Silver: Silver futures are up 6.5% to $76.61.
BASE METALS
Copper: Copper prices rose to a three-week high on the ceasefire news, with benchmark three-month copper on the LME up 2.7% at $12,650. Still, rising warehouse stocks pressure prices and are likely to cap gains in the metal. The broader near-term macro case for copper appears bearish as elevated energy prices and supply chain risks weigh on the outlook for industrial demand and global growth, though a material end to the conflict has the opportunity to unwind these risks. While the ceasefire may lead to a near-term easing in the energy risk premium, the agreement appears fragile and conditional, suggesting markets are likely to remain headline-driven rather than shifting to a sustained risk-on backdrop.
Goldman Sachs on Monday raised its forecast of a surplus in the global copper market this year to 490,000 tons from the previously expected 380,000 tons after its economists estimated that higher energy prices could shave 0.4% off global GDP growth. Copper stocks in LME-approved warehouses on April 7 stood at 385,275 tons, the highest since March 2018, after 10,075 tons of inflows to New Orleans and locations in Asia over the Easter break. The cash LME copper contract’s discount to the three-month forward widened to $98 a ton from $84.60 on Tuesday, implying there is no shortage of available metal.
Major Chinese smelters are planning to raise or maintain output in 2026, per 2026 earnings outlooks, despite a public commitment late last year to cut production by more than 10%. Jiangxi Copper, China’s top copper smelter, raised 2026 production guidance for copper cathodes to 2.39 million metric tons, up from 2.38 million tons produced in 2025. Similarly, Yunnan Copper increased its 2026 guidance to 1.71 million tons, up from 1.64 million tons produced last year. Daye Nonferrous, which published results last week, flagged a slight drop in 2026 to 713,000 tons, from output of 716,000 tons for last year. The three smelters produced a third of China’s refined copper last year.
Zinc: Zinc was flat at $3,307.
Aluminum: Aluminum eased 0.4% to $3,463.
Tin: Tin soared 4.3% to $47,950.
Lead: Lead added 0.4% to $1,953.
Nickel: Nickel jumped 2.3% to $17,345.
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