Written Commentary
COPPER
Copper futures declined to just above the $4.03 per pound on Monday, deepening last week’s over 14% drop to its lowest level in nine weeks. Top consumer China retaliated Friday with a 34% tariff on all U.S. imports, effective April 10, opting not to negotiate.
The new U.S. tariffs exclude copper, gold, energy, and certain minerals not sourced domestically. Copper had surged to record highs in late March on speculation that President Donald Trump might target the metal specifically, but prices have since pulled back as those concerns have yet to materialize.
GOLD
June gold futures briefly fell below the $3,000 per ounce level on Monday, marking its third straight day of losses. Profit-taking and margin calls in other markets led investors to sell some of their precious metals holdings. A growing trade war sparked a sharp downturn in financial markets, raising concerns that it could weaken the global economy.
Precious metals are likely to find some support in light of increasing pressure on the Federal Open Market Committee to lower interest rates.
SILVER
May silver futures were lower in the overnight trade. However, prices were able to recover and are now higher. Volatility remains elevated as investors continue to evaluate the effects of President Donald Trump’s trade policies.
Silver declined by as much as 16% over the last three sessions, as concerns over a potential downturn in the economy. Traders liquidated long positions in precious metals to cover losses in other assets.
After the White House imposed extensive tariffs on all countries last week, China retaliated with its own tariffs on U.S. goods, and other major economies are expected to follow suit.
Despite the broader market downturn, silver and other precious metals may see renewed buying as traders anticipate the Federal Open Market Committee may more aggressively reduce interest rates this year.
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