metais

#Metais

Last week, global financial markets continued to be impacted by tightening liquidity. The yield on the 30-year U.S. Treasury hit close to 5.20%, reaching its highest level since 2007, while the yield on the 10-year notes surpassed 4.5%. Japanese bond yields also increased simultaneously, raising expectations for a rate hike by the Federal Reserve later this year. Macroeconomic uncertainty has increased, putting pressure on risk assets. Copper prices have been oscillating in a tight range due to the tug-of-war between liquidity tightening and geopolitical relief expectations. Precious metals faced additional pressure from rising U.S. Treasury yields and interest rate hike expectations, trading in a clearly depreciated manner.

Key Points

1

Liquidity tightening dominates market sentiment; copper prices are oscillating with an upward bias, but room is limited

U.S. and Japanese bond yields continue to rise, increasing expectations for a rate hike by the Federal Reserve (the market is pricing in a

nearly 50% probability

for a hike in December), amplifying macroeconomic headwinds. However, Trump stated that the U.S. and Iran
basically reached an agreement

and that the Strait of Hormuz will be reopened, bringing expectations of geopolitical relief and somewhat sustaining risk appetite. Copper prices are following a pattern of
support from the mining side, with macroeconomic pressure
limiting both upside and downside.

2

The mining TC fell to -$107/ton, supply contraction trend continues

SMM

(Shanghai Non-Ferrous Metals Network) reported an imported copper concentrate index of

-$107.39

ton, hitting historical lows for several consecutive weeks. China's copper ore imports in April fell

19.57%

year-on-year, and the total from January to April saw a decline of

0.8%.