Gold Slips Below Copper as 2025's Top Asset as 'Risk Appetite' Soars
Friday, 6/27/2025 15:48
GOLD PRICES sank on Friday, losing almost 6.5% from mid-April's $3500 record as risk assets rose, led by Western stock markets setting fresh all-time highs on the MSCI World Index.
Copper prices signalled tightening global supplies ahead of next week's US trade tariffs review, while the US Dollar fell yet again despite a rise in US inflation data.
With President Trump apparently
preparing to appoint a "shadow" chief at the Fed, naming the successor to
"Mr.Too Late...terrible...stupid...very low IQ" Jerome Powell long before the current chair's term expires next May, betting on year-end US interest rates tightened a little to 3.73%, markedly below the Fed's latest forecast of 3.90%, repeated in last week's 'dot plot' economic projections.
Gold meanwhile fell to 4-week lows, down 1.4% for the day to fixing around $3272 per Troy ounce at London's 3pm bullion auction, even as the Dollar sank to a fresh 4-year low on its DXY index against the rich world's other leading currencies.
That helped push down the gold price in Euro terms to €2780, down 8.4% from mid-April's spot market record at what was a new all-time high in early February.
The
UK gold price in Pounds per ounce also sank as the Dollar fell against Sterling, dropping through £2375 for the first time in 6 weeks − and now 9.0% beneath mid-April's peak − at what was also a new all-time high in February.
With the first half of 2025 ending on Monday, gold today slipped behind copper as the best-performing major asset class across the past 6 months, up 24.3% since New Year's Eve against copper's 25.0% rise in US Dollar terms.
New York's S&P500 index of US stocks has traded less than 5.0% higher, European equities have risen 8.4% in Dollar terms, while crude oil has lost 8.2%.
Industrially-useful silver has meantime risen by 23.8% so far in 2025, while palladium has now added 24.7% − three quarters of it in June − and platinum has jumped by 47.6%.
"What with the Iran-Israel agreement, the China-US trade deal, and Section 899 of the Big Beautiful Act being scrapped," says a macro-analysis from French investment bank Natixis, "political, geopolitical and commercial risks are dissipating one after the other this week, sustaining appetite for risk.
"The only downside is macro uncertainty − growth, inflation, monetary policy − which remains high, particularly in the US, given the already high valuations of risky assets."
Platinum lease rates in London's bullion market stayed historically high on Friday at 13.5%, albeit down 9 percentage points from mid-June's new all-time peaks.
US stockpiles of base metal copper − sometimes called the metal with a PhD because of its importance to global economic activity − have now swollen for 15 weeks running, notes spread-betting analyst Ole Hansen at Saxo Bank, growing larger than the inventories of all London Metal Exchange (LME) and Shanghai Futures Exchange (SHFE) warehouses combined,
"With the US accounting for less than 8% of global copper demand," says Hansen, "this shift underscores growing tightness outside the US, with tariffs and trade flows increasingly distorting market balance."
Oil today rallied for a 3rd session, up to what was a 2-month high in mid-June but still 16.1% below Monday morning's spike to 5-month highs, after it plunged by more than 1/5th in just 2 days after
the US bombing of Tehran's nuclear sites was followed by
President Trump's 'F-bomb' ceasefire between Iran and Israel.
Today's new inflation data said that the Federal Reserve's preferred measure of core PCE rose one notch last month to 2.7% per year from April's 4-year low.
Despite the higher baseline for US trade tariffs imposed by President Trump, America's trade deficit in goods blew past analyst forecasts for May, coming in almost 1/10th larger at more than $96 billion.
Trump's stated deadline of July 8 for restarting additional tariffs on key US trade partners is "not critical" said White House Press Secretary Karoline Leavitt overnight.
"Perhaps it could be extended, but that’s a decision for the President to make."
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