Daily Metals

What's Moving Markets?Global stocks lost ground amid ongoing signs of persistent inflation in the US economy. Core PCE, the Fed’s preferred inflation gauge, rose 2.9% YoY in Jul, matching expectations but marking the fastest increase since Feb. Crude oil markets pushed higher amid concerns of renewed restrictions on Russian supply. Constraints on Chinese output also supported base metals. Yields on 10-year US Treasuries fell last week by 3bp to 4.23%, while the USD index was steady at 97.7.In a shortened US week, Aug jobs data will unveil whether the labour market holds the sharp slowdown evidenced in the previous releases. Nonfarm payrolls, the unemployment rate, wage growth, the ADP report, the JOLTS, and Challenger job cuts reports will post fresh insights. ISM PMIs will also offer gauges on growth, employment, and prices. Key US data also includes the trade balance for the impact of tariffs.China’s official NBS Manufacturing PMI inched up to 49.4 in Aug 2025 from Jul’s three-month low of 49.3, marking the fifth straight month of drop in factory activity and falling short of market estimates of 49.5. Output grew for the fourth consecutive month and at the fastest pace since Mar (50.8 vs. 50.5 in Jul), lifted by the extension of the tariff truce between Washington and Beijing for another 90 days. Also, buying levels rose the most in five months. Still, overall demand remained sluggish, with new orders (49.5 vs. 49.4) showing little improvement despite fresh consumer subsidies and export sales (47.2 vs. 47.1) continuing to fall amid weak overseas demand and lingering trade barriers.Precious metals secured gains as investors sought refuge amid uncertainty over US monetary policy. Concerns that political pressure on the Fed could accelerate interest rate cuts have bolstered prices, with markets largely pricing in a 25bp reduction in Sep. Adding to the dovish tone, New York Fed President John Williams indicated that a rate reduction was under consideration, echoing Chair Powell’s remarks at Jackson Hole. Gold closed at a record high at $3,448, and silver at a fresh 14-year high at $39.72.Base metals scored gains, with copper inching towards the $10,000 mark on positive macro data. Aluminium gained after producers warned of supply constraints. South32 CEO, Graham Kerr, said that the availability of cheap, low-cost subsidised smelters in China is shifting, which provides price support. Beijing has capped aluminium smelting capacity at 45mtpy to rein in power consumption and emissions. Copper stocks monitored by the three major futures exchanges climbed to a four-month high this week after a 4.4kt inflow lifted the total to 488.3kt. Notably, COMEX warehouse stocks continued to rise, hitting a 21-year high of 250kt. That now represents 51% of total exchange inventories, well above the five-year average of around 19%. Elsewhere LME rose 2.9kt while SHFE saw a 2kt reduction. Tin prices have strengthened through Aug, as speculative positioning continues to support prices, as do dwindling LME stocks, which remain below 2kt.Iron ore gained as expectations of stronger demand persisted and moves to curb overcapacity in steel. China will push to cut steel production between 2025 and 2026, according to an official document reviewed by Reuters, as it tackles overcapacity that has hit prices and fed a worldwide protectionist backlash. The world's largest steel producer will strictly curb new capacity and reduce production, the planning document from the industry and environment ministries, among others, showed.