Written Commentary
SILVER
June silver futures hovered around flatline after finishing the session lower on Tuesday, weighed down by a stronger dollar and greater risk sentiment.
Long-term outlook for silver remains supportive, as silver is a key ingredient in semiconductors, solar panels, and other clean-energy technologies, which have seen high investments from governments across the globe. New data shows China’s wind and solar capacity has risen significantly in Q1 of 2025, while solar power output in Europe rose by 30% annually in the first quarter.
For silver, managed money traders were net buyers of 2,091 contracts, increasing their net long to 30,551.
GOLD
Gold futures ticked higher in overnight trade after June contracts fell nearly two percent yesterday as a delay in tariff implementation sparked a risk-on sentiment that boosted demand for equities and strengthened the dollar.
Gold imports into Switzerland from the US jumped to their highest monthly level since 2012 in April, Swiss customs data showed. Swiss gold exports to Britain rose, indicating that gold was coming from the US back to London vaults via Swiss refineries.
Investors await Friday’s PCE inflation data for insights into the Fed’s interest rate outlook. A lowering of interest rates by the Fed would be supportive of gold prices, which benefit in a lower interest-rate environment. Markets are anticipating two 25 bps rate cuts this year, with the first cut coming at the September meeting. Weakening economic data will raise pressure on the Fed to cut rates and also spur safe-haven demand for gold. The long-term outlook of a weakening dollar will also be supportive of gold prices.
Friday’s Commitments of Traders Report showed managed money traders were net buyers of 7,742 contracts of gold for the week ending May 20, increasing their net long to 118,615.
Strong central bank demand and investor demand from China remain in favor of gold’s upside. China’s central bank added gold to its reserves in April for the sixth straight month. Chinese customs data showed gold imports surged 73% in April to an 11-month high of 127.5 metric tons, as Beijing expanded import quotas during a period of trade tensions with the US.
COPPER
July copper futures extend their losses from Tuesday, which saw prices fall two percent, pressured by a stronger dollar.
The US Supreme Court declined to hear a Native American group’s bid to block plans for one of the world’s largest copper mines on Tuesday. The site, which sits atop sacred Apache ritual grounds, holds reserves of more than 40 billion pounds of copper. The move from the Supreme Court boosts plans for the mine to move ahead with construction.
CME copper stocks continue to rise, reaching an eight-year high of 175,631 tons. The growing supplies of copper in the US have weighed on copper prices and shrunk the premium of CME copper over LME copper from $1,600 per metric ton to around $600 per ton. According to US government data, copper imports in March rose to more than 123,000 tons compared with around 58,000 tons in February and 76,000 in January. Stocks at the Shanghai Futures Exchange fell to 98,671 tons after rising to 108,142 a week earlier.
Friday’s Commitments of Traders Report showed managed money traders were net sellers of 2,800 contracts of copper for the week ending May 20, reducing their net long to 21,980.
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