Finding your Safe Haven! Manic Metals Report 03/31/2025

Have you found your safe space? Treasury bonds and gold are soaring this morning as traders tried to seek safety in a world that has become nervous about the possibilities of war and sanctions,

A significant drop in Asian stock markets led to a decline in copper prices, despite rising long-term demand and tightening supplies.

China’s manufacturing activity expanded at the fastest pace in a year, with the purchasing manager index rising to 50.5% from 50.2%, the highest since March 2024. However, the Nikkei index fell by about 4%, and the Hang Seng index decreased by 1.31%.

Reuters reported that gold prices surged above $3,100 per ounce on Monday to a record high, as worries about potential inflation due to U.S. tariffs set the safe-haven asset up for its strongest quarter since 1986. Bullion continued its remarkable rally that has already seen the metal gain around 18% so far this year.
This comes against the backdrop of major central bank buying in people buying gold like crazy unlike anything we’ve seen since the gold rush of the 1980s.

The outlook for copper demand continues to look optimistic as it’s demand could double by 2040 due to large scale deployment of artificial intelligence and grid upgrades we have said for some time that we believed that the copper prices could double from here mainly because there is a structural shortage on the market copper prices continued to need to go higher to inspire the type of production that’s going to be needed.

Reuters reported that Chile’s Codelco (COBRE.UL), the world’s largest copper producer, has been redirecting some of its spot sales to the United States, CEO Ruben Alvarado said on Friday.

U.S. President Donald Trump in February ordered a probe into potential new tariffs on copper imports in an effort to rebuild U.S. production, a move that appeared to prompt a rush for copper. Alvarado also said he did not see any reason for copper to be subject to a sanction or tariffs, and anticipated strong long-term fundamentals for copper demand beyond short-term swings.

Silver’s market action remains disappointing despite being undervalued compared to gold. Richard Ebel noted that in 1980, silver was 3.5% of gold’s price, whereas today it is only 1.3%. If silver hits 3.5% again, its value will rise sharply. Currently, silver is considered the cheapest asset on Earth, but this won’t last forever.

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