Precious Metals
While recent cross-asset developments have sent a risk-on signal, with equities and bond yields both higher, the commodity complex has recently been sending a more somber message. “Dr. Copper” is a bellwether for the global economy given its industrial…
The market got excited by the 50 bps Fed cut and China stimulus. But these are a recognition that economies are slowing significantly. Stocks often rally after the first Fed cut, before falling sharply. Investors should stay defensive.
Industrial metals returned a whopping 6% over the past week. Bullish investor sentiment is likely driving these gains. The soft-landing narrative has been gaining traction in recent days with markets pricing in increased odds of an outsized 50-bps Fed rate…
As an industrial metal, copper acts as a barometer of economic activity. Silver and gold are safe-haven assets with inflation-hedging properties, though silver is relatively more sensitive to global growth developments given that industrial applications…
According to BCA Research’s Commodity & Energy Strategy service, central banks will continue to be a key source of gold demand. Central bank purchases in the first half of this year exceeded first-half purchases in every year they’ve been tracked going…
Gold reached new all-time highs earlier this week. The yellow metal has returned a whopping 20.2% YTD, with the rally reaccelerating over the past month. Gold prices are inversely correlated with the dollar, and the expectations for US interest rate cuts have…
Industrial metals were one of the worst performing asset classes last month. Have prices declined enough to make them an attractive investment? The outlook for industrial commodity prices is bearish over a 12-month horizon given we expect the US economy to…
Chinese exports in USD terms missed expectations in July, growing by 7.0% y/y, down from 8.6% in June. Conversely, imports rebounded smartly from a 2.3% contraction, rising by 7.2% in July and upending expectations of 3.2%. Slower export growth is…
Concerns about the global economy have shifted from sticky inflation to faltering growth. Tight monetary policy is finally starting to bite. We suggest increasing portfolio defensiveness.
Historically, there has been a tight inverse relationship between the price of gold and US real rates. Elevated interest rates raise the opportunity cost of holding gold, making the yellow metal relatively less attractive for investors. Yet this…