1️ Impact of Sino-American Trade Negotiations
- The dialogue between Presidents Trump and Xi Jinping is having a positive effect on metals markets, particularly copper, which benefits from optimism linked to a possible resumption of trade and stabilization of commercial relations.
- This dynamic fuels industrial demand, especially for copper, a key metal in construction, infrastructure, and green technologies sectors.
2️ Supply and Inventories
- The decline in stocks at the London Metal Exchange (LME) is increasing upward pressure on copper prices, connected to anticipated tariffs that could limit supply or redirect trade flows.
- This reduction in inventories reflects strong demand and supply struggling to keep pace amid trade tensions.
3️ Precious Metals – Focus on Gold
- The price of gold has rebounded to over $3,360 per ounce, driven by several factors:
- Concerns over ongoing trade tensions.
- Heightened geopolitical tensions, notably the escalation of the conflict in Ukraine and the failure of peace talks in Turkey, which reinforce gold’s status as a safe-haven asset.
- Gold continues to fulfill its traditional role as a refuge in times of economic, political, and geopolitical uncertainty.
4️ Global Demand and Central Bank Purchases
- Although central bank gold purchases slowed in April, overall demand remains strong.
- Since the beginning of the year, gold prices have risen approximately 28%, reflecting sustained interest from investors and central banks seeking to secure reserves amid global uncertainties.
5️ Macroeconomic Perspectives and Risks
|
Factor |
Main Impact |
Outlook |
|
Trade Negotiations |
Supports industrial demand (copper) |
Moderate upside potential |
|
Reduced Stocks (LME) |
Upward pressure on copper prices |
Supply remains tight |
|
Geopolitical Tensions |
Increased safe-haven demand (gold) |
Strengthening gold’s role |
|
Central Bank Purchases |
Stable demand despite slight slowdown |
Medium-term support |
|
Inflation / Interest Rates |
Affects gold’s opportunity cost |
May moderate demand depending on developments |
Conclusion
- The precious metals market, especially gold, benefits from an uncertain geopolitical and economic context that supports safe-haven demand.
- Copper benefits from hopes of trade stabilization and tighter supply, which could support prices in the short to medium term.
- For investors, volatility remains high, but precious metals continue to offer an attractive hedge against macroeconomic and geopolitical risks.
- It is advisable to monitor:
- Developments in Sino-American trade negotiations,
- Evolutions in geopolitical conflicts,
- Central bank purchasing policies.