Metals Recover Following US Inflation Data Release

Tashkent, Uzbekistan (UzDaily.uz) — Precious metals have begun to recover their positions following the publication of June inflation data in the United States, while industrial metals continue to rise against a backdrop of supply constraints, according to Alpari analyst Anna Bodrova.

According to her, the slowdown in US consumer price growth was below market expectations, easing concerns over an imminent interest rate hike by the Federal Reserve. This supported demand for both precious and industrial metals, although geopolitical tensions in the Middle East continue to limit investor optimism.

Gold is trading near US$4,030 per ounce, while silver has dropped below US$59 per ounce. Both metals have partially recovered recent losses following a revision of expectations regarding US monetary policy. The probability of a Federal Reserve rate hike as early as September is estimated at approximately 50%, but the market no longer expects immediate policy tightening.

Among precious metals, the analyst highlighted palladium, which rose above US$1,310 per ounce and gained more than 5%, reaching its highest level in nearly a month. The growth was supported by a weakening dollar and lower rate expectations, as well as news from South Africa, where Sibanye-Stillwater is accelerating the implementation of new mining projects.

In the industrial metals market, copper rose above US$6.25 per pound. Prices were supported by production cuts in Chile, the world's largest copper exporter. The decline in production is linked to water shortages, deteriorating ore quality, technical shutdowns, and labor disputes.

Aluminum is holding near US$3,150 per ton. According to Macquarie's estimate, the global aluminum market could face a deficit of about 930,000 tons this year, which remains one of the key factors supporting prices.

In the steel market, rebar futures in China exceeded 3,100 yuan per ton, reaching a one-month high. Despite a decline in steel exports and weak profitability of steel companies, market participants expect a reduction in supply due to rising coking coal costs, planned maintenance, and reduced production volumes at Chinese steel mills.

According to Anna Bodrova, the metals market is currently balancing between two factors: easing US inflationary pressure, which reduces the pressure of high interest rates on commodity assets, and ongoing geopolitical risks and supply constraints supporting industrial metals.