Background on Key Figures and Context
Volodymyr Zelenskyy, the President of Ukraine, has been at the forefront of negotiations to end the ongoing conflict with Russia. His efforts, alongside US officials, have led to significant progress in talks aimed at resolving the war. Steve Witkoff, the US Special Envoy for Ukraine, reported that substantial advancements have been made in discussions concerning Ukraine. Meanwhile, a US official informed Reuters that both parties have narrowed the differences between Russia and Ukraine.
Impact on Gold Market
Gold prices initially rose by over 1% during the trading session following the progress in these talks. However, spot gold saw a reduction in gains, trading at $4,309.82 per ounce, while US gold futures also gained 0.2%, reaching $4,335.2 per ounce.
Jim Wyckoff, senior analyst at Kitco Metals, explained that the advancements in peace talks between Russia and Ukraine are curbing demand for gold as a safe-haven asset.
Silver Market Performance
Spot silver experienced a 2.6% increase, reaching $63.61 per ounce, just shy of its all-time high of $65.
Bob Haberkorn, senior strategist at RJO Futures, predicted that silver will trade above $65 by the end of the year and potentially reach $70 early in the next quarter.
Platinum Group Metals Market Update
Nornickel, Russia’s largest platinum producer, reported in a metals market review that considering investment demand, the platinum market could face a deficit of 0.2 million ounces this year.
Copper Market Dynamics
The three-month copper reference price on the London Metal Exchange (LME) increased by 1.5% to $11,687. The red metal reached an all-time high of $11,952 on Friday due to concerns about supply shortages. However, it later experienced a correction as traders feared a potential bubble burst in the artificial intelligence sector.
Alastair Munro of Marex stated that prices would remain volatile and erratic until the end of the year and into the first quarter.
Short positions or bearish bets on the LME were being reduced or renewed ahead of Wednesday’s close, according to a trader. Approximately 39% of the 165,875 metric tons of copper stored in LME-registered warehouses were marked for export.
Other base metals saw the following movements: zinc decreased by 0.6% to $3,104, while lead fell 1% to $1,948.
Key Questions and Answers
- What is the significance of the progress in Ukraine peace talks? The advancements in negotiations between Russia and Ukraine, facilitated by US officials and President Zelenskyy, have reduced demand for gold as a safe-haven asset.
- How has this progress affected gold prices? Initially, gold prices rose by over 1% during trading; however, gains were trimmed as the focus shifted towards potential resolution of the conflict.
- What are the predictions for silver prices? Silver is expected to trade above $65 per ounce by the end of the year and potentially reach $70 early in the next quarter, according to Bob Haberkorn of RJO Futures.
- What is the outlook for platinum group metals? Nornickel, Russia’s leading platinum producer, anticipates a deficit of 0.2 million ounces in the platinum market this year due to investment demand.
- How have copper prices performed recently? Copper prices reached an all-time high of $11,952 on the LME due to supply concerns but later corrected amid fears of an AI sector bubble burst.
