Written Commentary
PRECIOUS METALS
Gold: Gold prices are lower following a selloff in the Asian session alongside lower Chinese demand ahead of the Lunar New Year. Following Friday’s selloff and limited recovery in prices earlier this week, gold could be set to enter a consolidation range barring any geopolitical surprises. However, lower volume is likely to risk increased volatility. Still, structural support for gold persists as central banks continue diversifying away from the dollar, reducing FX reserves and increasing gold purchases—a trend expected to provide ongoing support through 2026. On the geopolitical front, talks between Iran and the US appear to be in question as tensions remain elevated after the US military shot down an Iranian drone approaching a US aircraft carrier on Tuesday.
The January jobs report will now be released on February 11 because of the partial government shutdown. Data collection is already finished, but the shutdown has nonetheless forced a delay in the schedule. On the monetary policy front, markets are friendly to a July cut and are fully priced in for a cut in September, after expectations shifted slightly to later in the year following the strong ISM manufacturing data. Services data will be out later in the morning and is set to provide an update on economic momentum and price pressures.
Silver: Silver futures are down nearly 11.5% to $74.60. Silver suffered heavy selling during the Asian session, wiping out gains from the previous two sessions. Chinese demand remains weak ahead of the Lunar New Year. There is also talk of a large short position being held by a Chinese investor, which has dampened sentiment. Silver is likely to continue to face extreme volatility in both directions in the near term. The silver, platinum and palladium markets are small relative to gold, making them vulnerable to speculative inflows. This dynamic has presented the risk that prices have become detached from physical demand conditions. Additionally, record high prices could be poised to limit industrial demand.
Platinum: Platinum is down 7.3% to $2,013.
BASE METALS
Copper: Copper prices fell, as rising inventories in exchange stockpiles weigh on supply worries amid a broad commodity selloff. Benchmark three-month copper on the LME was down 1.1% at $12,905. Available stocks in LME-registered warehouses rose to 180,575 tons, their highest since May, while inventories at the SHFE climbed to their highest level since April at 133,004 tons after months of waning supply. Reports have been circulating that the Chinese State Reserves Bureau is releasing copper into warehouses to ease recent price spikes. The cash LME copper contract was trading at a discount of $85 a ton to the three-month forward, suggesting little demand for the metal in the near term.
China announced plans to boost stockpiles of copper, though several traders have cautioned against over-interpreting the remarks. Currently, there are no details on the planned size of the reserves, scale of purchases, or timeline. China’s Lunar New Year holiday in mid-February will also bring industrial activity to a standstill in the country which consumes more than half of global copper production estimated at around 26 million tons this year.
In the US, ISM Manufacturing PMI data surprised to the upside, with the index rising to 52.6 in January from 47.9 the previous month to mark the fastest pace of growth in the manufacturing sector since 2022. The reading also marked the first time the sector experienced an expansion in growth in 12 months. Despite the positive reading, the increase in activity is attributed to cyclical factors regarding the start of the year. January is a reorder month, and the buying was likely an effort to get ahead of expected price increases. Factory activity in some parts of the world expanded in January, offering some assurance the hit from higher tariffs has run its course for now, but the growth was from a low base and followed months of shrinking activity.
Zinc: Zinc shed 1% to $3,276.
Aluminum: Aluminum fell 1.1% to $3,036.
Tin: Tin slid 5% to $46,100.
Lead: Lead dipped 0.6% to $1,954.
Nickel: Nickel lost 2.4% to $16,960. Goldman Sachs and Macquarie lifted their average 2026 nickel price forecasts above $17,000 on Tuesday, citing tighter supply from top producer Indonesia.
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