Written Commentary
GOLD & SILVER
With several critical central bank meetings this week, gold and silver are finding mild pressure early on. The precious metals saw mixed results on Friday as gold could not shake off mild early pressure by the close, while silver rallied to a 3 1/2 month high. A mixed tone in recent US economic data has led to uncertainty over the Fed’s rate cut outlook this year. The Dollar continues to hold close to an early 1 1/2 week high, and that is weighing on precious metals prices. The PGM metals have found little benefit from strong Chinese economic data as both are under early pressure this week.
COPPER
Copper prices are starting out under mild early pressure after rising 4.9% from Wednesday through Friday, hitting a 12 1/2 month high, as the market is starting to reflect tight near-term global supplies. LME copper stocks have only had six daily builds over the previous 55 readings and have fallen to their lowest levels since early September. Expectations of a Chinese economic rebound has provided support to copper recently. While the latest Chinese industrial production reading was higher than expected, that has been offset by a sharp increase in Shanghai exchange copper stocks over the past four weeks. Shanghai deliverable copper stocks reached 286,395, their highest since April 2020. On the other hand, last week’s news that Chinese smelters are cutting their production capacity continues to underpin copper prices.
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