Overall Macroeconomic Backdrop

 

  • Economic Growth: Major economies like the US, China, and the Eurozone are showing signs of sluggish, uneven growth. This "soft patch" is tempering demand for industrial commodities.

  • Interest Rates: Central banks, including the Federal Reserve, have likely paused their rate-hiking cycles, but rates remain elevated to keep inflation in check. This makes holding non-yielding assets like gold less attractive and can strengthen the US dollar, which typically pressures commodity prices.

  • Geopolitical Tensions: Ongoing conflicts and strategic competition continue to create uncertainty, providing potential support for safe-haven assets and posing risks of supply chain disruptions, especially in energy.

  • Energy Transition: The long-term shift towards decarbonization remains a powerful structural driver for specific metals essential for electrification and batteries.

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