Written Commentary
GOLD
Gold futures are little changed after hitting a two-week high on Tuesday, lifted by safe-haven demand as investor confidence wavered slightly amid the drama regarding President Trump’s firing of Fed Governor Lisa Cook. Gold is also likely to face headwinds today due to a stronger dollar. Fed policy has been the main driver in gold prices recently, with investor focus turning to Friday’s PCE inflation data for further clues to Fed policy. Markets are now pricing in an 87% chance of a quarter-point rate cut at the September policy meeting. There is still a high degree of uncertainty when it comes to the interest rate path, and recent PMI and PPI data has shown significant indications that inflation could persist for the coming months and peak in the fall. A strong PCE reading could dampen expectations of a September cut and lead to a stronger dollar, pressuring gold.
Trump’s decision to remove Cook is poised to set up a clash over how much power the president has at the central bank. Cook said late Monday night that Trump has no authority to fire her and that she would continue in her job and filed a lawsuit against the president on Tuesday. If the president is successful in his attempt to oust Cook, that would open the door for a Trump-appointee majority board that would have a dovish tilt.
COPPER
Copper futures are sharply lower, weighed down by a stronger dollar, rising supply inventories, and concerns over the demand picture in China. Data from China was mixed, showing industrial profits declined for a third straight month in July against a backdrop of weak demand and ongoing factory gate deflation. However, the declines were less than those seen in May and June. LME copper inventories added another 1,100 tons in data released on Wednesday and have surged by 72% since late June to 156,100 tons. COMEX stocks have nearly tripled so far this year.
Chile’s mining regulator Sernageomin is raising its requirements for copper giant Codelco to restart areas of its flagship El Teniente mine after a deadly collapse. Codelco said on Monday it is working to gradually reopen the Andes Norte and Diamante sectors, after approvals from Sernageomin and the labor inspector’s office, but said its Recursos Norte and Andesita units remain closed. The state-run miner now expects 2025 production of 1.34-1.37 million metric tons of copper, down from a March estimate of 1.37-1.40 million tons, a trim of 30,000 tons on both ends. Elsewhere on the supply front, a US federal appeals court temporarily blocked a land transfer crucial for Rio Tinto and BHP to proceed with what could become one of the nation’s largest copper mines.
Traders are waiting for further clues on demand prospects in the world’s biggest consumer of industrial metals, China, from surveys of purchasing managers in its manufacturing industry due Saturday evening.
SILVER
Silver futures are lower, continuing a three-day slide. China’s industrial momentum remains strong, with recent data showing solar cell exports surged over 70% in the first half of the year, fueled by robust photovoltaic demand from India. This follows a record-breaking installation of more than 93 gigawatts of solar capacity in May—a 300% year-over-year increase—driven by a rush to connect panels ahead of upcoming policy changes that will tighten grid access.
On the supply side, global silver mine production has declined by 7% since 2016, contributing to an estimated shortfall of 800 million ounces between 2021 and 2025. Investor appetite remains resilient, with silver-backed exchange-traded products (ETPs) attracting net inflows of 95 million ounces in the first half of 2025. Since 2019, over 1.1 billion ounces have been withdrawn from mobile inventories.
Silver prices continue to find support from a persistent structural supply deficit and strong investor demand. Industrial usage is expanding, particularly in energy-related sectors such as solar power, electric vehicles, and electronics. Notably, solar applications accounted for 17% of total silver demand last year—triple their share from a decade ago.
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