Written Commentary
GOLD
February gold futures are higher on Wednesday as traders continued to evaluate the global political and monetary situation.
Lower interest rates benefits gold by lowering the opportunity cost of holding non-interest-bearing assets. In addition, gold’s appeal as a safe-haven was bolstered by political uncertainties in South Korea and France, along with ongoing geopolitical tensions in the Middle East and the Ukraine – Russia conflict.
SILVER
March silver futures advanced on Wednesday, reaching a more than one-week high as markets expect the U.S. Federal Reserve will reduce interest rates again at its December meeting.
Silver and other precious metals gained from increased safe-haven demand due to South Korea’s unsuccessful martial law attempt and ongoing violence in the Middle East. In addition, speculation is rising that China may announce additional stimulus measures during key political meetings this month, which could further drive demand in the world’s largest metals consumer.
COPPER
March copper futures are steady today but remain near three-week highs, following a nearly 2% increase in the previous session. The price advance was fueled by speculation that Beijing might announce additional stimulus measures during key political meetings this month.
Over the past week, President-elect Donald Trump has issued two tariff threats, including a warning of a 100% tariff on BRICS nations if they create a currency to compete with the U.S. dollar. Also, recent data indicated that Chinese manufacturing activity expanded for the second consecutive month in November, supporting the demand outlook for copper.
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