Metals Daily

This MorningLead gained almost 1% on this early Wednesday morning. Nickel and tin just lifted a little bit. Aluminium remained pretty much unchanged overnight. Zinc dipped a bit, while copper lost almost 0.5%. What's Moving Markets?Global equities ended mostly lower, as markets continued to assess the magnitude of tariffs that may be passed by US and the outlook of policy by the Fed. Headline inflation rose as expected in Jun, although the core rate was marginally below expectations. Still, markets were set on a rate hold by the Fed this month as the FOMC is still likely to see upside inflation risks from tariffs. White House officials noted that trade negotiations are ongoing with the EU, Japan, and Korea after the three countries were slapped with aggressive levies, risking the possibility of sharp price increases in August. Rising trade tensions weighed on sentiment across commodity markets. Energy markets dipped as fears of supply disruptions eased. Yields on 10-year US Treasuries rose by 5bp to 4.49%, while the USD index was 0.6% stronger at 98.6.Precious metals were stable as bets of a rate hold by the Fed this month consolidated as US headline inflation rose to 2.7% in Jun, as expected, while markets continued to price two rate cuts this year. Bitcoin hit $123k for a new ATH and might be diverting interest away from gold. IMF data shows that gold reserves at the National Bank of Kazakhstan rose by 7t in Jun - the fourth consecutive month of buying. This lifted YTD net purchases to 22t, and total gold holdings to 306t. Data from the Central Bank of Türkiye indicated that official gold reserves (CB + Treasury) rose by 2t in Jun. YTD net purchases now 17t; total official gold reserves at 635t.Base metals were little changed. China's Q2 GDP beat forecasts again with a 5.2% YoY growth, driven by strong trade and industrial production. Yet sharper-than-expected slowdowns in fixed-asset investment and retail sales and falling property prices are a concern. Trump’s plan to impose a 50% levy on copper imports by 1 Aug means that traders have run out of time to seek arbitrage profits by sending metal from Europe and Asia to the US. Stocks are being re-warranted on the LME as traders realize that it could no longer reach the US market before the 50% tariff comes into effect. Spot copper on the LME traded about $62/t lower than the three-month futures, compared with a premium of almost $320/t on 26 Jun. Losses were limited by data showing robust demand in China. Copper imports were up, with unwrought copper reaching 460kt backed by solid demand and falling inventories. Still, weaker import arbitrage could slow future inflows. Concentrate imports held steady at 2.35Mt, with H1 growth of 6.4%. Expanding domestic smelting capacity kept concentrate demand robust. Rio Tinto said Simon Trott to succeed Jakob Stausholm as CEO from 25 Aug. Trott is currently iron ore CEO and was the company's first chief commercial officer. Prior to this he held MD roles across multiple Rio Tinto commodities and geographies.Iron ore gained amid signs of stronger demand. China’s imports of iron ore hit 106Mt in Jun, up 1% YoY. Strong steel production, healthy mill margins, and low steel inventories appear to have motivated mills to restock raw materials. China's crude steel output in Jun fell 3.9% from May and posted the largest annual decline of 9.2% since last Aug, as more steelmakers carried out equipment maintenance amid a seasonal low in demand and a national plan to cut output.