Written Commentary
GOLD
June gold futures surged above $3,000 per ounce on Tuesday, recovering from a near four-week low reached yesterday as fears of an escalating trade war spurred increased demand for safe-haven assets. On Monday, President Donald Trump threatened to impose a 50% tariff on Chinese goods starting Wednesday unless Beijing rescinds its 34% retaliatory tariffs. However, the European Union proposed 25% counter-tariffs on various U.S. products.
In addition, there was some support due to a lower U.S. dollar.
SILVER
May silver futures have recovered and are now trading above $30 per ounce on Tuesday, following a period of significant volatility as investors continued to assess the shifting global trade landscape and its impact on economic conditions and inflation expectations.
Last week, the silver market faced pressure in light of a broader risk-off sentiment, driven by concerns over a potential global recession, leading to widespread sell-offs across various asset classes. However, market sentiment has dramatically improved after President Donald Trump indicated a willingness to engage in trade talks with key partners, raising hopes for a de-escalation of global trade tensions.
Additionally, U.S. Treasury Secretary Scott Bessent mentioned that nearly 70 countries have approached the White House to discuss possible tariff Agreements.
Despite the broader market downturn, silver and other precious metals may see renewed buying as traders anticipate the Federal Open Market Committee may more aggressively reduce interest rates this year.
COPPER
May copper futures advanced on Tuesday, likely driven by a technical rebound after a 20% drop over the previous three sessions, which was fueled by concerns about possible global economic weakness.
Investor sentiment improved following U.S. President Donald Trump’s indication of a willingness to engage in trade talks with major trading partners, including Japan, raising hopes for easing global trade tensions. However, market volatility is expected to stay high as President Trump has threatened to impose a further 50% tariff on Chinese imports.
Meanwhile, the new tariffs introduced by Trump do not apply to copper, gold, energy, or certain minerals that are not available in the US.
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