Daily metals

What's Moving Markets?Global equities rallied as traders digested the Fed’s first interest rate cut of the year and better-than-expected jobless claims. The Fed cut its rates by 25bp, as expected, and published median projections of two more rate cuts this year, although upward revisions to expectations of higher core inflation and growth tempered bets of more cuts next year. Volatility followed the decision and Chair Powell’s press conference, where he framed the move as a “risk management” cut and cautioned that there are no risk-free paths. A stronger USD weighed on sentiment across the commodities complex following the Fed decision to cut rates. Yields on 10- year US Treasuries rose by 3bp to 4.11%, while the USD index was 0.5% stronger at 97.4.AI Has the Potential to Redefine Trade and Growth: Artificial intelligence is no longer just a buzzword — it’s becoming a powerful engine for reshaping the global economy. According to the WTO, AI could boost global trade by 34–37% and raise global GDP by 12–13% by 2040.The US DoE’s Office of Fossil Energy & Carbon Management has announced up to $6mn in federal funding available for R&D projects to help establish a secure domestic supply chain for gallium — a critical material for the energy, defence, and semiconductor sectors.Precious metals ended mixed; gold corrected lower after a brief run higher in the wake of the release of the FOMC statement, but silver and the PGMs made modest gains. Chair Jerome Powell struck a cautious tone on further easing, describing the move as a risk-management measure in response to a softening labour market. He added that the central bank will take a “meeting-by-meeting” approach to assessing the future path of interest rates. Gold has now exceeded its inflation-adjusted peak of Jan 1980. The Bank of Ghana raised its gold reserves by 2t in Aug, to 36t. Its gold reserves are now 27t higher than at the end of May 2023, when it commenced its recent buying.Profit-taking undermined the base metals complex, with all metals falling. Higher metals output in China also weighed on sentiment. China’s zinc output in Aug hit its highest monthly level since Q124 as smelters benefited from higher processing fees and improved availability of ore. Refined zinc output rose 23% YoY to 651kt, according to data from China’s National Bureau of Statistics. Production of refined copper was also stronger, rising 15% YoY to 1.3Mt. Indonesia is evolving from a nickel resource supplier into a strategic hub for battery and EV manufacturing, with strong growth in LFP and integrated supply chain development driven by Chinese investments and local policy support. Cathode Trends: LFP vs. NMC. LFP to hit 80% EV share by 2030 (cost/safety); NMC falls to 22% (premium segments). China leads LFP adoption (>80%); Europe/US follow. Over the past two weeks, LME aluminium prices have climbed by 5–6%. Key drivers are China’s production cuts – energy restrictions and CO₂ caps have reduced smelter output. US tariffs (50%) – on primary aluminium and semi-fabricated products from China & the EU → Midwest premiums rising, pulling metal from other regions. China’s imports – Jul imports +38% YoY (360kt), strong demand from EVs and infrastructure.Iron ore gave up recent gains on weak Chinese economic data. Weak Chinese economic data highlighted ongoing property sector stress, with new home prices falling 0.3% in Aug from the previous month, extending a downturn that began in May 2023.