Written Commentary
GOLD
Gold futures firmed in overnight trade, helped by a weaker dollar as investors await more clarity on trade news between the US and its trading partners. Gold edged lower on Friday and was headed for a second consecutive weekly loss as easing trade tensions between the US and China and a strong jobs report kept prices pressured. China’s commerce ministry said the US has repeatedly expressed willingness to negotiate on tariffs and that Beijing’s door is open for talks.
Friday’s Commitments of Traders Report showed managed money traders were net sellers of 9,857 contracts of gold for the week ending April 29, reducing their net long to 115,865.
Gold-backed ETFs saw weekly inflows of 51.19 tons last week, a drop from the prior week’s inflow of 85.96 tons.
Investors will be turning their attention to the Federal Reserve’s policy decision on Wednesday and commentary from Fed Chair Jerome Powell on insights into future monetary policy trajectory. Lower interest rates would be supportive for gold, which benefits in a low-interest environment.
SILVER
Silver futures were higher as the dollar softened in overnight trade. Silver has underperformed gold this year, as it does not benefit from central bank buying, while investment demand has been dampened by economic growth worries. Half of the total demand for silver comes from the industrial sector. Increased industrial sentiment could prove supportive for the metal. However, US dollar strength has the potential to weigh on gains.
Despite growth worries, silver demand is expected to grow steadily over the forecast horizon, supported by its role as both an alternative safe-haven financial asset and an input to growing industrial sectors like renewable energy technologies and semiconductors. Record-high industrial fabrication and global photovoltaic installations are set to support demand for silver this year, although these industries face potential downside risks from recent tariff announcements.
For silver, managed money traders were net buyers of 5,078 contracts, increasing their net long to 31,252.
COPPER
Copper futures continued higher Monday amid signs of improving US-China trade relations. The Trump administration on Friday added 10 more U.S. mining projects to a fast-track permitting list aimed at expanding critical minerals production across the US. The projects would supply copper, palladium and other minerals. The projects have been granted FAST-41 status, a federal initiative launched in 2015 to streamline approvals of critical infrastructure.
The gains brought the premium of Comex copper over LME copper to $881 a ton, as expectations that President Trump will impose tariffs on copper have resulted in a strong flow of the metal to the US, which has a limited copper smelting capacity.
Friday’s Commitments of Traders Report showed managed money traders were net buyers of 3,424 contracts of copper for the week ending April 29, increasing their net long to 20,013.
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