Written Commentary
GOLD & SILVER
Today will be a test of the gold and silver bull’s resolve with the US Fed likely to hike rates by 50 basis points but a portion of the trade this morning is still fretting over the prospect of a larger hike. However, the bigger threat is the potential for overly hawkish US Fed dialogue which could promise aggressive front-loaded hikes to head off inflation.
PALLADIUM & PLATINUM
With the PGM markets yesterday holding up in the face of choppy to lower action in the gold and silver trade, it is possible the markets are beginning to factor in significant tightening supply and the massive price difference between palladium and platinum. As for palladium, a Reuters poll expects Russian supply to dry up and in turn underpin prices.
COPPER
The copper market continues to attempt to consolidate its bounce from the Monday spike low, with the bull camp hopeful following news that lockdown rules in Shanghai are loosening and overall infection numbers show aggressive containment efforts are working. However, the market should see lingering pressure because of the latest International Copper Study Group’s unchanged forecast of a 439,000-tonne 2021 deficit and a prediction of a 142,000-ton surplus for 2022 from yesterday’s trade.
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