Metals Daily

This Morning With U.S. desks having reopened after Friday's Independence Day break, Monday's early Asian trade tracked close to Friday's official closes. Copper eased to 13,298 from a 13,317.36 settle (down 0.1%), while aluminium slipped fractionally to 3,080 versus 3,083.3. Zinc was the clear laggard, quoted at 3,474 against Friday's 3,541 close — off around 1.9% and the session's biggest mover. Nickel softened to 16,125 (down 0.6%) and lead eased to 1,850.5 (down 0.4%), while tin held relatively firm at 51,995 versus 52,261 (down 0.5%). The tone is cautious and consolidative after last week's post-payrolls recovery. Macro & Geopolitics It has been one of the quietest weekend openings in months, with no fresh tariff or conflict headlines and much of the market watching football. Euro-zone inflation slowed to 2.8% in June, giving the ECB some breathing room. Attention turns to Wednesday's Fed minutes from Kevin Warsh's first meeting as chair, expected to read hawkish given several members plotted hikes for this year — though that preceded the sharp payrolls miss and slide in oil. Markets now imply roughly a 78% chance of a July hold. OPEC+ agreed a further 188,000 bpd output increase from August, pressuring Brent toward four-month lows near $72 and easing inflation worries. ECB speakers including Lagarde and Lane feature today. Base Metals Aluminium led the complex higher in Asian hours as LME warehouse stocks dropped below 300,000 tonnes for the first time since 2022, underscoring tight near-term supply. Gains were capped, however, by a fading Middle East war premium and smelter restart announcements, though some analysts argue fresh supply will take longer than expected to reach the market. Copper hovered marginally firmer as traders continue to await a U.S. decision on refined-copper import tariffs, with LME copper stocks falling while Comex inventories build. China's non-ferrous metals equity index rallied more than 3%. Zinc, lead and nickel were softer on the LME, while tin found modest support on its structural deficit narrative. Precious Metals Gold eased from a two-week high, last down around 0.4% near $4,160 as the dollar firmed from recent lows, though easing Fed hike bets limited losses. Bullion notched a weekly gain of over 2% last week, snapping a four-week losing streak after the soft payrolls print. J.P. Morgan sees gold averaging $4,300 in Q3 and $4,500 in Q4, but flagged that demand from key sectors may prove weaker than expected. Silver retreated toward $62 after touching its highest since June 23, while platinum and palladium slipped modestly after multi-session gains. Wednesday's Fed minutes are the key near-term catalyst. Steel Europe's revamped steel safeguard regime took effect on 1 July, cutting duty-free import quotas by 47% to 18.3 million tonnes and doubling the out-of-quota tariff to 50%. The flat-steel market fell largely silent as participants digested the country-by-country quota allocations published just beforehand, with new import inquiries close to zero. Northern European plate mills announced hikes of up to €70/tonne, and buyers broadly expect flat prices to firm as the quotas bite. A melt-and-pour origin traceability requirement follows from 1 October. Separately, EUROFER trimmed its 2026 EU apparent steel consumption growth forecast to 0.4%, warning that weak production and high energy costs mean this is no genuine recovery. Rare Earth Metals Supply bottlenecks in export-controlled heavy rare earths look set to persist through 2026. European magnet-feedstock buyers have fared better than U.S. peers — European imports rebounded strongly late last year while U.S. flows never recovered to pre-restriction levels — but premiums for neodymium-praseodymium and heavy elements such as dysprosium, terbium and yttrium remain elevated where assured long-term supply matters. The looming November 2026 expiry of the suspension on China's second wave of controls is sustaining front-loaded procurement, meaning the usual July-August summer lull may prove shallower than normal. Non-Chinese processing capacity remains the key constraint. Forex The euro was flat around $1.1434 in early trade, holding just above the recent 13-month low of $1.1325, as the dollar index steadied near 100.88 after its post-payrolls dip. June euro-zone inflation at 2.8% did little to shift the single currency. For European traders, a broadly stable dollar leaves greenback-priced metals import costs little changed after last week's relief. The yen nudged up toward 161.8 per dollar, not far from 40-year lows near 162.84, with speculators still wary of possible Japanese intervention. Sterling was steady ahead of UK composite PMI data. Watch Today German industrial orders and output for May (0600 GMT), euro-zone retail sales and producer prices, UK composite PMI (0830 GMT) and the U.S. ISM services survey are all due. ECB President Lagarde and board members Schnabel and Lane speak, alongside Fed Governor Waller in Rome. Expect thin conviction ahead of Wednesday's Fed minutes.