Written Commentary
GOLD / SILVER
While gold and silver have started out on a weaker footing today the markets should find support from news that gold ETF holdings increased for the 8th straight session yesterday, with the chain of inflows the longest since January 6th. Silver ETF holdings also increased by 240,647 ounces and are 3.7% higher on the year.
PLATINUM / PALLADIUM
With the palladium market flaring to a 4-day high yesterday and promptly reversing course and starting out under pressure this morning, a temporary top might have been put in place. The world platinum market is slightly smaller than the world palladium market at 8 million ounces, but a private consultancy forecast calling for a deficit of only 68,000 ounces in platinum is still discouraging to the bull camp.
COPPER
Obviously, the broad-based risk off environment has contributed to the weakness in copper overnight with prices this morning matching 8-day lows. While the weakness in equities and fears of higher rates to control inflation are the primary bearish forces operating in the copper market, we also suspect that Chinese efforts to deflate soaring industrial material prices is adding to the downside tilt. In fact, coal futures, zinc futures, iron ore, and steel prices have corrected and in turn provided spillover pressure to copper prices early today.
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