Written Commentary
GOLD
December gold futures advanced to new record highs in the overnight trade. However, prices are currently lower in light of strength in the U.S. dollar. Recent strength in the yellow metal is linked to it’s safe-haven appeal in light of rising geopolitical tensions and ongoing macroeconomic uncertainty. The upcoming U.S. election is also fueling demand for safe-haven investments.
SILVER
December silver futures are lower and have fallen under the $34.00 per ounce support level. Yesterday silver futures were able to advance to their highest levels in nearly 12 years as global uncertainties and indications of physical shortages supported the metal.
Additionally, the global push for cleaner energy has boosted industrial demand for silver, which is a key component in solar panels. There has been support for silver after China, the leading metals consumer, recently announced new stimulus measures to spur economic growth, including cuts to key lending rates and increased liquidity in capital markets.
COPPER
December copper futures are lower on Wednesday, reversing gains from the previous session, as a strengthening U.S. dollar caused traders to reduce expectations for aggressive interest rate cuts by the U.S. Federal Reserve. A stronger U.S. dollar increases the cost of commodities for buyers using other currencies, which can reduce demand.
However, copper prices have recently been underpinned by optimism regarding Chinese demand following recent stimulus measures from Beijing.
In addition, rising expectations for stronger copper demand is linked to the transition to cleaner energy, which have raised concerns about potential supply shortages, since miners continue to face challenges in ramping up production.
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