Written Commentary
SILVER
Silver futures are sharply lower, reversing most of Friday’s gains. On the industrial side, recent data showed that China’s solar cell exports surged more than 70% in the first half of the year, driven by robust photovoltaic demand from India. This followed news that China installed over 93 gigawatts of solar capacity in May, a record high and a 300% year-on-year increase, ahead of policy changes that will make it more difficult to connect new panels to the grid.
For silver, managed money traders were net buyers of 530 contracts, increasing their net long to 28,787.
On the supply side, global mine output has declined by 7% since 2016, contributing to an estimated shortfall of 800 million ounces between 2021 and 2025. Investor interest remains strong, with silver-backed exchange-traded products (ETPs) seeing net inflows of 95 million ounces in the first half of 2025. Since 2019, over 1.1 billion ounces have been drawn from mobile inventories.
Silver prices remain well-supported by a persistent structural supply deficit and robust investor demand. Industrial usage continues to expand, 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—three times their share from a decade ago.
Despite recent headwinds from tariff-related developments, silver’s long-term outlook remains constructive. Its critical role in clean energy technologies, underscored by rising solar capacity in China and Europe and resilient semiconductor demand, continues to underpin its strategic importance.
GOLD
Gold futures slipped in the overnight session as a stronger dollar weighed on the yellow metal, easing from a two-week high hit on Friday after Fed Chair Powell opened the door for a rate cut. Powell on Friday signaled a possible rate cut at the Fed’s meeting next month, saying that risks to the job market were rising but inflation remained a threat, and that a decision wasn’t set in stone.
Markets are now pricing in an 83% chance of a quarter-point rate cut at the September policy meeting – compared to nearly 90% after Powell’s comments on Friday. Friday’s data on July PCE inflation—the Fed’s preferred measure of inflation—will be the next key item of data ahead of the central bank’s 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.
Friday’s Commitments of Traders Report showed managed money traders were net sellers of 12,468 contracts of gold for the week ending August 19, reducing their net long to 141,758.
COPPER
Copper futures are higher. The gains follow Powell’s Jackson Hole speech on Friday, where he signaled the central bank is likely to ease policy at its next meeting. Powell stressed that while unemployment remains low, risks to the labor market are building and monetary policy remains “restrictive,” indicating that adjustments may soon be warranted. Copper prices also found support from supply concerns after a US federal appeals court temporarily blocked a land transfer essential for Rio Tinto and BHP to move ahead with what could become one of the country’s largest copper mines.
Chilean miner Codelco on Sunday said mining regulator Sernageomin has approved the restart of the Andes Norte and Diamante divisions of its El Teniente copper mine, after an accident on July 31 that forced a suspension of operations. 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.
Friday’s Commitments of Traders Report showed managed money traders were net buyers of 561 contracts of copper for the week ending August 19, increasing their net long to 25,105.
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