Written Commentary
BASE METALS
Copper: Copper prices slipped ahead of today’s Fed decision, while quarterly results from major miners offered some insight into the demand and supply outlook. Benchmark copper on the LME was down 0.6% at $13,607, continuing to find support at the 50-day moving average, which is just under $13,600. COMEX prices are down 0.63% to $6.32. Rio Tinto posted a 43% jump in earnings. Strength from its copper and aluminum units supported growth, thanks to a push in electrification and AI-infrastructure. Meanwhile, Glencore reported that 1H 2026 copper production rose 15% thanks to higher ore grades. The miner produced 397,000 metric tons of copper in the first half of the year, up from 343,900 tons in the same period last year. It maintained its full-year production guidance at 810,000 and 870,000 tons.
In China, the Yangshan copper premium held at $112 a ton, easing from last week’s $115, indicating a slight pullback in demand, though still elevated. Available copper in LME warehouses sits at 101,975 tons. Available stocks remain near YTD lows amid heavy cancellations at the beginning of July, which has elevated the premium of the cash contract over the three-month forward to $30 from $-49 at the start of July.
Zinc: Zinc was steady at $3,578.
Aluminum: Aluminum rose 0.9% to $3,176.
Tin: Tin added 1.1% to $54,175.
Lead: Lead rose 1% to $1,913.
Nickel: Nickel gained 1.3% to $17,190.
PRECIOUS METALS
Gold: August gold contracts moved lower overnight, though found support at the $4,000 level. Oil prices rose sharply overnight following a US and Saudi strikes in Iraq and an intercepted Iranian missile attack on US forces. However, traders remained on the sidelines ahead of today’s policy decision. Markets are fully priced for a rate hike in September and see a 36% chance of a hike at today’s meeting. However, given the current environment, a 25bp hike should not be discounted and we expect to see several members support a rate hike. We continue to expect a move upwards in Fed policy this year, likely coming in September, though believe the market is underpricing the risk of a hike at today’s meeting. The greatest indicator of a move upwards in policy is the Two-year yield, which has risen 90 bps since the conflict between the US and Iran began, currently sitting over 50 bps above the upper bound of the current Fed Funds target rate. Today’s FOMC decision and press conference could see significant volatility arise. Hawkish signals from the Fed are could see gold test 2026 lows ($3,941), while any dovish tilt would could see a breakout toward the $4,100 level.
Silver: September contracts are down 0.11 % to $57.46.
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