Written Commentary
PRECIOUS METALS
Gold: Gold prices are higher, once again hitting record highs as the metal crossed $5,000 an ounce. Gold crossed the $5,000 threshold overnight, extending its historic rally investors continue to flock to safe havens amid a sharply lower dollar and rising geopolitical tensions after President Trump threatened Canada with a 100% tariff if it follows through with its trade deal with China. Elsewhere on the geopolitical front, talks in Abu Dhabi to end the war in Ukraine between the two warring sides ended with seemingly no progress made over the weekend, though more discussions are expected to take place again next weekend.
Loads of economic data this week could help shape policy expectations from the Fed, as the bank is expected to hold steady on rates when it announces its policy decision this week but inflation and labor data are likely to continue to serve as the main guideposts on policy.
Central bank buying and a broader move away from the dollar have remained supportive of gold prices and is set to continue to provide structural support for the metal throughout 2026. Data showed that China extended its gold buying streak in December, marking the fourteenth consecutive month of central bank purchasing from the country. China’s gold holdings rose to 74.15 million fine troy ounces at the end of December, from 74.12 million in the previous month. The value of China’s gold reserves increased to $319.45 billion at the end of last month, from $310.65 billion a month earlier, according to the PBOC.
Silver: Silver futures are up over 8% as the metal surpassed the $100 level for the first time. Silver is benefitting from safe-haven flows and a structural supply-demand deficit thanks to its role in various technologies.
Platinum: Platinum is 2.5% higher at $2,808.
BASE METALS
Copper: Copper prices hit a one-week high on the LME as market focus shifts back to demand expectations amid supply disruptions. Benchmark three-month copper on the LME was up 1% at $13,245. Concerns regarding supply disruptions over the past 12 months continue to support prices as forecasts of soaring demand from AI datacenters points to elevated long-term demand. Demand prospects from China are also in focus in light of the country’s economic growth plans after a surge in investment was announced by the state grid earlier this month. China’s state grid said that it would spend four trillion yuan ($574 billion) to upgrade the country’s power grid between 2026 and 2030.
However, the gains in price come amid signs of easing in tightness on near-term copper availability, while the Yangshan copper premium, a gauge of Chinese appetite for copper imports, has stabilized at $22 a ton, its lowest since mid-2024. The premium of the COMEX copper contracts against the LME ones has narrowed down sharply, prompting deliveries to LME-registered warehouses in the US, while copper inventories in warehouses monitored by the SHFE rose 6%.
This week will also bring China’s latest industrial profit data for December as the country battles fierce competition, which has kept prices ultra-low and prompted attention from authorities. Forecasts are generally expecting industrial profits to have improved across most sectors amid a modest pickup in growth in the second half of 2025.
Zinc: Zinc advanced 3.2% to $3,365.
Aluminum: was up 0.8% at $3,195.
Tin: Tin traded 2.5% down at $55,350. Focus is on the SHFE, which imposed position restrictions on multiple clients for failing to disclose details relating to control over trading accounts.
Lead: Lead was up 0.8% at $3,195.
Nickel: Nickel was down 0.2% at $18,720.
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