Tashkent, Uzbekistan (UzDaily.uz) — As of 16 September, the metals market has once again reached a point where macroeconomic factors are becoming more important than the usual supply-and-demand dynamics.
Investors are awaiting the US Federal Reserve’s decision, with the market almost fully pricing in a 25-basis-point rate hike. Some metals are attempting to recover after a sell-off, but the overall backdrop remains tense: oil continues to keep inflation risks in focus, bond yields remain high and the dollar is strong.
Gold is trading at around US$4,330 an ounce, while silver has risen to about US$64.6 an ounce after falling at the beginning of the week. Both metals have received short-term support from cautious buying ahead of the Fed meeting, but the key question remains how hawkish the regulator’s tone will be.
If the Fed limits the move to a single rate hike and signals a softer approach to further steps, gold and silver could continue to recover. If the US central bank signals a readiness for another series of rate increases, pressure on precious metals could quickly return.
The situation for gold is particularly delicate. On the one hand, geopolitical risks and doubts about the sustainability of the global economy are supporting interest in safe-haven assets.
On the other hand, higher interest rates and yields make assets without intrinsic income less attractive. This is why gold is not receiving its usual strong support from tensions in the Middle East: the market is looking not only at the conflict itself but also at its inflationary effects through oil and logistics.
Platinum and palladium have also recovered slightly after their recent declines. Platinum is trading at around US$1,790 an ounce, while palladium is at about US$1,310 an ounce.
In the short term, both metals are moving alongside the broader precious metals sector and remain dependent on the dollar, interest rates and risk appetite. However, their underlying fundamentals differ. Platinum is supported by expectations of a supply deficit, while palladium faces more complicated long-term demand prospects due to the growing share of electric vehicles and gradual substitution in automotive catalysts.
In the industrial metals segment, copper remains the main story. The price is holding at around US$6.4 per pound, below recent peaks but still at a very high level. The market has cooled somewhat after its August surge, when expectations of US import tariffs sharply altered trade flows and drew significant volumes of metal into US inventories. Some of that pressure has now eased, but fundamental support remains: copper continues to be needed for power generation, data centres, electricity grids and projects linked to artificial intelligence.
Zinc is one of the most interesting metals in the industrial group. After rising to nearly US$4,000 per tonne, the market has stabilised somewhat, but prices remain near multi-year highs. The main factor is a shortage of readily available metal.
LME inventories are considered low, while mining and processing problems in various regions suggest that the deficit may not be a short-term spike but a deeper shift on the supply side.
Aluminium is trading at around US$3,250 per tonne and appears calmer than copper and zinc. The market is balancing between two factors.
On the one hand, low inventories and supply disruptions in some regions continue to support prices. On the other, expectations of a gradual recovery in production and supplies are preventing aluminium from accelerating as strongly as copper or zinc. For buyers, this means the market remains tight but without panic.
Overall, by mid-September the metals market has once again split into two distinct dynamics. Precious metals are awaiting the Fed’s decision and depend on how the regulator explains the future path of interest rates.
Industrial metals are looking deeper, at actual inventories, trade flows and long-term demand from energy, infrastructure and technology.
As a result, the key question now is not only whether the Fed will raise rates, but also how quickly the metals market can shift from macroeconomic concerns to the fundamental story of supply shortages.
