Written Commentary
PRECIOUS METALS
Gold & Silver:
Gold is caught between two competing inflation trades. Higher oil and rising Treasury yields are raising the probability of another Fed hike (CME Fed Watch tool 62% chance of 25 basis points next week), and the bear camp is likely to begin to press the metals lower. In fact, if the Dollar were following oil and interest rates higher metals would probably be under wholesale liquidation pressure. However, while gold remains resilient near $4,400, surging Open Interest could mean a downside breakout is looming.
BASE METALS
Copper:
Copper’s record rally has hit its first serious fundamental challenge. LME copper approached $15,000 per tonne after an 11-week advance driven heavily by metal moving toward the U.S. ahead of potential refined-copper tariffs. But a late report that the White House has not yet decided whether to impose cathode tariffs sent LME copper down more than 2%. That reaction confirms that the U.S. import incentive, not stronger end-user consumption, has become an important source of price discovery.
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