Central bank and ETF purchases supported gold in the third quarter, while jewelry and bar and coin demand weakened at the same time; the US copper mining project pipeline has expanded, but most new supply will not arrive until after 2030.
JPMorgan expects the Federal Reserve to raise rates again in December and maintains its call for a steeper U.S. Treasury curve. It remains overweight emerging-market currencies, but rate volatility and growth pressures are prompting the bank to narrow its selections. Meanwhile, economic growth in multiple countries is accompanied by falling oil demand.
Central bank and gold ETF buying recovered in the third quarter, but high gold prices depressed jewellery consumption. The US copper mine project pipeline expanded, with most new supply due after 2030; smelting capacity remains a bottleneck.
JPMorgan says European natural gas prices have returned above 100 euros per megawatt-hour, while a recovery in Russian refining could increase diesel supplies; agricultural risk premiums have fallen, and the value of energy positions has reached a record high.
JPMorgan reviews energy and metals markets: European natural gas prices are approaching unusually high levels, while rising Russian diesel exports are offset by falling Chinese inventories; as iron ore weakens, lower freight costs improve miners’ free-on-board prices.
Citi compares consensus commodity prices for 2027 with current spot prices: precious metals are expected to trade well above spot, while coal and zinc are expected to trade below spot. Rio Tinto’s approved 1.9 billion US dollar bauxite project will add capacity at Weipa, but is unlikely to fully offset the impact of other mine closures.
As of 23 October, the value of commodity open interest tracked by JPMorgan rose for a third consecutive week, with energy contributing most of the increase; the latest published investor net long position nevertheless fell as positions in metals and agricultural products were reduced.
Brent is trading nearly 20 dollars per barrel above J.P. Morgan’s supply-demand model; a mild European winter could ease natural gas consumption, but recent heating demand has already slowed storage injections. Chilean copper production has fallen, while growth in the value of commodity positions has been concentrated mainly in energy.
