Metals Rise Following December Payrolls

PRECIOUS METALS

Gold: Gold prices are higher following December’s labor report, which saw the economy add 50,000 jobs in December and the unemployment rate edge down from 4.5% to 4.4%. Employment continued to trend up in food services and drinking places and health care and social assistance. Meanwhile, federal government employment was little changed in December and employment showed little or no change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; transportation and warehousing; information; financial activities; professional and business services; and other services.

Rate cut odds for a January cut dropped to 3% and expectations of future easing have been shifted farther back into the year. However, markets are still pricing in a cut from the Fed in June.

The Supreme Court’s ruling on Trump’s tariffs could potentially come later this morning, for which prediction markets are placing an unfavorable outcome for the Trump administration. Polymarket odds are pricing a 70% chance of an unfavorable ruling for the administration in the case. The Supreme Court announced that it would issue a set of opinions on Friday, though it did not disclose what cases it would be ruling on. The central question is whether or not the IEEPA grants the President the legals means and authority to impose tariffs.

Silver: Silver prices are up 5% to $78.85, getting a boost following December’s payroll report after profit-taking pressured the metal in recent days. Silver has been benefitting from safe-haven buying and increased investor attention. The gold-silver ratio is hovering near 57 after plummeting from 81 in late November, hitting its lowest level since August of 2013. Since 2022, the gold-silver ratio has largely maintained a range between 75 and 95 but shot to as high as 105 in April as gold prices soared and silver remained relatively subdued, in part thanks to weak retail investor attention and global economic slowdown worries, which weighed on silver’s industrial demand side.

Platinum: Platinum is up 2% to $2,310are higher. Recent support for the metal has come from a recent pivot by the European Union on its 2035 combustion-engine ban, a tight supply backdrop, and rising investment demand. Platinum and palladium are both used in cars to reduce exhaust emissions. The EU’s extension regarding the delay of its engine ban is indefinite and will also require stricter emission standards, which could require higher platinum and palladium contents in exhaust systems.

BASE METALS

Copper: Copper prices are higher and set to end the week higher after hitting a record high of $13,387.50 on Tuesday. Benchmark three-month copper on the LME was up 0.4% to 1.20% to $12,873, mirroring moves in precious metals. Shanghai copper also set a record earlier this week at  105,500 yuan a ton. Copper’s pullback since Wednesday was largely driven by profit-taking. However, prices remain well-supported from mine disruptions and tight refined copper availability outside the US amid tariff uncertainties.

S&P Global on Thursday said that growth in the AI and defense sectors will boost global copper demand 50% by 2040, while supplies are expected to fall short by more than 10 million metric tons annually without more recycling and mining. While the electric vehicle industry has lifted copper demand the past decade, the AI, defense and robotics industries will require even more of the metal during the next 14 years alongside traditional consumer appetite for air conditioners and other copper-hungry appliances.

Mine disruptions, including an accident at Freeport-McMoRan’s Grasberg mine in Indonesia in September and a strike at Capstone Copper’s Mantoverde copper and gold mine in northern Chile, have reinforced the theme of shortages. However, the mine only produces between 29,000 and 32,000 metric tons of copper a year, which is only a fraction of global mined output. Still, for traders it reinforces recent worries over supply shortages, as many copper mines have faced serious setbacks and delays in 2025, which has stemmed production. Copper demand is expected to rise about 3% in 2026, thanks in part to AI data center infrastructure demand, which is likely to land copper in a 300,000 – 400,00 ton deficit for the year. Many existing mines have been run at or well beyond their capacity for many years, which has consequently led to several mine failures, as seen in 2025. Elevated copper prices are likely to spur investment in the industry to generate new production, but the structural issues in place are hard to pass and likely to support prices for some time.

Zinc: Zinc added 0.5% to $3,170.

Aluminum: Aluminum rose 1.20%, still holding above the $3,000 level following the shutdown of the Mozal smelter in Mozambique. Supply constraints have also been strained from the EU’s new carbon tax, which consequently has reduced the flow of the metal into the trade bloc. Additionally, China announced a 45 million-ton output cap, which has fueled some supply shortage concerns.

Tin: Tin climbed 1.78%.

Lead: Lead gained 0.67%.

Nickel: Nickel rebounded 1.87% to $17,475. The Indonesian government refrained from disclosing its 2026 mining output quota, snapping a sharp rally that had sent the metal to its highest since mid-2024 on Wednesday at $18,800.  LME nickel stocks climbed to 276,300 tons, the highest since June 2018, after 20,760 tons of inflows. Meanwhile, the discount of the cash LME nickel contract over the three-month forward widened to $224 a ton on Wednesday, implying no pressing need for near-term metal.

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