Certain headwinds have emerged at the macro level. Although the Federal Reserve’s FOMC meeting last week cut interest rates by 25 basis points as expected, Powell made hawkish remarks at the press conference afterward, expressing uncertainty about a rate cut in December. This also reflects to some extent the significant divergence within the Fed regarding the future interest rate path. Since various assets had already fully priced in a December rate cut, Powell's comments put pressure on assets including gold and copper.

In the precious metals sector, COMEX gold fell by 2.75% last week, while silver dropped by 0.33%; the SHFE gold contract for December 2025 declined by 1.72%, and the SHFE silver contract for December 2025 rose by 0.96%. Among the major industrial metal prices, COMEX copper and SHFE copper changed by -0.07% and -0.81%, respectively.

Although the Federal Reserve’s FOMC meeting last week cut interest rates by 25 basis points as expected, Powell made hawkish remarks at the press conference afterward, expressing uncertainty about a rate cut in December. This also reflects to some extent the significant divergence within the Fed regarding the future interest rate path. Risk assets had already fully priced in a December rate cut, and Powell's comments put pressure on assets including copper. Additionally, the likelihood of a short squeeze in the copper market decreased somewhat last week, leading to some capital outflows from the market. However, the closure of Tanzania’s Dar es Salaam port over the weekend has escalated, which is expected to provide support for copper prices.

Last week, the Federal Reserve’s FOMC meeting cut interest rates by 25 basis points as expected, but Powell’s remarks were relatively hawkish, reflecting evident divisions within the Fed regarding a potential December rate cut. Market expectations for further rate cuts significantly receded after the meeting. Meanwhile, last week’s Sino-US talks released positive signals, boosting market risk appetite. As a result, under the dual effects of a rebounding US dollar and waning safe-haven demand, precious metal prices remain in an adjustment phase. In the short term, precious metal prices lack upward momentum. Attention should be paid to the restart of the US government and the release of corresponding economic data, as well as changes in December rate cut expectations. The long-term upward trend for gold remains unchanged amid the backdrop of hedging sovereign credit risks.

Last week, COMEX copper prices consolidated with volatility, facing certain headwinds at the macro level. Although the Federal Reserve’s FOMC meeting delivered the expected 25-basis-point rate cut last week, Powell made hawkish remarks during the press conference afterward, expressing uncertainty about a December rate cut. This also reflects to some extent the significant divergence within the Fed regarding the future interest rate path. Risk assets had already fully priced in a December rate cut, and Powell's comments put pressure on assets including copper. Additionally, the likelihood of a squeeze in the copper market diminished last week, leading to some capital outflows from the market. However, over the weekend, the closure of Tanzania's Dar es Salaam Port began to escalate, which is expected to lend support to copper prices.

Last week, SHFE copper prices retreated from the high range near RMB 89,000 per ton. After the price rebound, it was evident that domestic refined copper consumption weakened, with noticeable consumption suppression across all segments, including refined copper and copper rods. We believe that the current level of domestic refined copper consumption is insufficient to sustain higher copper prices. Following an increase driven by other factors, domestic consumption struggles to provide adequate upward momentum. However, with copper prices retreating somewhat, we expect domestic downstream buyers to re-enter the market for procurement, once again providing downside support for copper prices.

In terms of term structure, the COMEX copper price curve shifted upwards previously, but the curve remains in contango. Currently, the delivery of COMEX copper inventory continues, surpassing 350,000 tons. Since the siphon effect observed in mid-March, COMEX copper inventories have cumulatively increased by over 250,000 tons. Comparing U.S. copper import sources and COMEX registered brands while considering the restocking capacity of U.S. domestic enterprises, it is estimated that there are still 50,000 to 100,000 tons of copper yet to be explicitly reflected, leaving no particularly suitable strategy for the COMEX copper structure.

Last week, the SHFE copper price curve shifted downward compared to the previous period. As we previously noted, with the continuous decline in spot premiums during the peak season, we were not optimistic about the upward potential of month-to-month spreads, which has proven accurate thus far. Furthermore, September refined copper imports have been confirmed to exceed 330,000 tons, and it is expected that single-month import volumes will remain elevated in the fourth quarter. Coupled with high copper prices and weak refined copper consumption, it is difficult to foresee the price curve strengthening in the fourth quarter.

Regarding positioning, due to the shutdown of the U.S. government, the CFTC’s position reporting and publication work has been temporarily suspended, leaving us unable to obtain the latest position data.

Data Source: Wind

Last week, the weekly index for copper concentrate TC was -42.45 USD/dmt, a decrease of 0.79 USD/dmt from the previous week. The spot market for copper concentrate has seen no significant changes recently, with treatment charges continuing to face pressure. There is a considerable divergence in the psychological expectations between buyers and sellers, resulting in an overall cautious sentiment and a subdued trading atmosphere. Clean copper concentrate spot TC mainly fluctuated within the range of -40 to -43. According to Mysteel research, Vale recently held tenders for two mines at 50,000 tons, with transaction prices around the mid -90s. The Yinchuan meeting did not set a Q4 guidance price but called for joint production cuts and established a baseline for treatment charges. The spot market for copper concentrate continues to exhibit tight supply, with mainstream treatment charges expected to remain near -40 USD in the short term. Market participants generally believe that next year’s market outlook involves many uncertainties, leading to low expectations for subsequent long-term contract negotiations.

Data Source: SMM

On the spot side, due to copper prices oscillating upward during part of the week, downstream enterprises exhibited a strong reluctance to purchase at high prices, with limited new orders. Additionally, some downstream processing enterprises have already ceased operations, leaving market consumption still weak. As the month-end approaches, constrained by factors such as capital pressures, daily transactions primarily maintained刚需 purchases. With short-term copper prices remaining elevated, downstream purchasing sentiment is expected to see limited improvement. However, considering the approach of the delivery month, sellers' willingness to offer large discounts has also weakened, so spot premiums are expected to stabilize and rebound. Notably, if copper prices decline significantly within the week, and given the currently limited availability of mainstream flat-price branded goods in circulation, spot premiums are anticipated to recover quickly, potentially ranging between a discount of 50 yuan/ton and a premium of 100 yuan/ton.

Data Source: SMM

Domestic electrolytic copper spot inventories amounted to 192,200 tons, an increase of 2,400 tons compared to the 23rd and 3,600 tons compared to the 27th. During the week, social inventories in the Shanghai market continued to rise, attributed to ongoing arrivals of domestic supplies being warehoused, coupled with reduced procurement intentions from downstream firms nearing the end of the month, compounded by oscillating upward copper prices, leaving downstream consumption lackluster. Looking ahead to next week, given the expectation of robust copper prices and continued arrivals of imported copper, downstream procurement needs are projected to remain driven by just-in-time demand, likely resulting in further minor inventory accumulation during the week. Meanwhile, inventories in the Guangdong market continued to decline, primarily due to relatively low dispatch volumes from smelters during the week, limiting warehouse inflows. However, under persistently high copper prices, downstream consumption remains constrained, with inventory declines remaining marginal.

Data Source: Wind

Processing fees for refined copper rods have continued to decline overall, with significant drops observed in the Guangdong and Hunan markets; under a high-price environment, order volumes have fallen, leading refined copper rod enterprises into periodic production cuts or shutdowns; some regions affected by policy adjustments have seen an overall decline in recycled copper rod production on a month-over-month basis; the price differential between refined and scrap copper rods, as well as the discount for recycled copper rods, has slightly narrowed; inventory pressure of finished refined copper rod products continues to grow, with downstream industries showing low acceptance of high prices, and without a significant drop in short-term copper prices, orders for refined copper rods may remain sluggish; currently, some regions with concentrated production capacity have already witnessed centralized reductions or halts in production, while market transaction risks caused by copper price fluctuations remain substantial, and terminal demand is low at this stage, resulting in persistently weak subsequent circulation ability of refined copper rods. Due to their strong economic advantages, some recycled copper rod manufacturers are actively promoting transactions at lower prices, making centralized market trading characteristics more pronounced, and certain regions will face significant delivery pressures subsequently; additionally, the wave of policy adjustments has struck again, causing individual regions to experience production halts, and as transactions proceed, inter-regional goods reallocation will become more frequent.

Data Source: SMM

Last week, gold and silver prices fluctuated within a consolidation range, with COMEX gold and silver trading between USD 3,901-4,124 per ounce and USD 45.5-49 per ounce respectively. Last week, the Federal Reserve’s FOMC meeting delivered a widely expected 25-basis-point rate cut, but Powell’s tone was relatively hawkish, reflecting clear divisions within the Fed regarding a potential December rate cut, causing market expectations for further easing to significantly retreat after the meeting. Meanwhile, last week's Sino-US talks sent positive signals, boosting market risk appetite. Consequently, driven by the rebound in the US dollar and waning safe-haven demand, precious metal prices remained in an adjustment phase.

Last week, gold declined while silver rebounded, leading to a pullback in the gold-silver ratio; the drop in gold prices was stronger than that of copper prices, resulting in a slight decline in the gold-copper ratio; the decline in crude oil prices was weaker compared to gold, causing the gold-oil ratio to trend downward amid fluctuations.

Data Source: Wind

Data Source: Wind

Data Source: Wind

The gold VIX continued to decline, accompanied by relatively positive signals from the China-U.S. talks, leading to a recovery in market risk appetite and a weakening of safe-haven demand, which drove down gold volatility.

Data Source: Wind

The impact of the RMB exchange rate has weakened compared to earlier periods. Last week, the domestic-foreign price spread and price ratio of gold fell, while the domestic-foreign price spread of silver rose, and the domestic-foreign price ratio slightly declined.

Data Source: Wind

Data Source: Wind

In terms of inventory, last week the COMEX gold inventory was 38.17 million ounces, down approximately 0.71 million ounces from the previous week, while the COMEX silver inventory was approximately 482.44 million ounces, decreasing by about 14.51 million ounces week-on-week. The SHFE gold inventory was approximately 87.8 tons, up 0.8 tons from the previous week, and the SHFE silver inventory was approximately 666 tons, increasing by about 0.6 tons week-on-week.

Data Source: Wind

Data Source: Wind

In terms of positions, SPDR Gold ETF holdings decreased by 7.7 tons to 1,039 tons month-on-month, while SLV Silver ETF holdings fell by 230 tons to 15,190 tons. Due to delayed data publication, as of September 23, the total non-commercial positions in COMEX gold amounted to 399,000 contracts, with non-commercial long positions increasing by 6,030 contracts to 333,000 contracts and short interest rising by 5,691 contracts to 66,100 contracts. Non-commercial long positions maintained dominance, but their proportion dropped to around 62.9% compared to last week, while the share of non-commercial short positions rose to approximately 12.5%.

Data Source: Wind

Data Source: Wind

Data Source: Wind

Data Source: Wind

Following the price rebound, a noticeable weakening in domestic refined copper consumption has been observed, with evident consumption suppression across all segments including refined copper and copper rods. We believe that the current level of domestic refined copper consumption is insufficient to support higher copper prices. After copper prices surged due to other influencing factors, domestic consumption struggled to provide adequate upward momentum. However, with copper prices now retreating somewhat, it is expected that domestic downstream buyers will re-enter the market to procure, once again providing downside support for copper prices.

In the short term, precious metal prices lack upward momentum. Attention should be paid to the resumption of the U.S. government's operations and the release of corresponding economic data, as well as changes in expectations regarding the interest rate cut in December. The long-term upward trend in gold prices remains intact against the backdrop of hedging sovereign credit risk.

PMI, non-farm payroll data, tariff policies, changes in interest rate cut trajectory.