In early to mid-August 2026, CAAM and the CPCA Passenger Car Association successively released relevant data on the auto market for July 2026. CAAM stated that in July, the auto market entered the traditional off-season, with foot traffic and orders naturally pulling back. This was compounded by factors including some demand being brought forward and released by the mid-year sales push, persistent nationwide high temperatures, and typhoons and flooding in certain regions affecting offline sales, resulting in a seasonal pullback MoM and a slight decline YoY. Among them, exports continued to maintain rapid growth, with monthly exports exceeding 1 million units for two consecutive months, and the share of NEV exports exceeding 50% for two consecutive months...... SMM compiled relevant data on the auto and battery markets for July 2026 for readers’ reference. Auto Market CAAM: Auto production and sales declined both MoM and YoY in July; the decline in January-July narrowed further versus H1 In July, auto production and sales totaled 2.573 million units and 2.584 million units, down 6.8% and 8% MoM, and down 0.7% and 0.3% YoY, respectively. From January to July, auto production and sales totaled 17.567 million units and 17.602 million units, both down 3.7% YoY, with the decline narrowing further versus H1. CAAM: NEV production and sales both rose over 20% YoY in July; from January to July, NEV new-vehicle sales reached 51.2% of total new-vehicle sales In July, NEV production and sales totaled 1.576 million units and 1.561 million units, up 26.8% and 23.7% YoY, respectively . NEV new-vehicle sales reached 60.4% of total new-vehicle sales. From January to July, NEV production and sales totaled 9.014 million units and 9.007 million units, up 9.5% and 9.6% YoY, respectively , and NEV new-vehicle sales reached 51.2% of total new-vehicle sales. CAAM: Auto exports exceeded 1 million units for two consecutive months; the share of NEV exports exceeded 50% for two consecutive months In July, auto exports were 1.043 million units, up 0.6% MoM and up 81.3% YoY . From January to July, auto exports were 6.14 million units, up 66.8% YoY. In July, NEV exports were 553,000 units, up 5.7% MoM and up 1.5x YoY ; traditional fuel vehicle exports were 490,000 units, down 4.6% MoM and up 40% YoY. From January to July, NEV exports were 2.909 million units, up 1.2x YoY; traditional fuel vehicle exports were 3.231 million units, up 36.2% YoY. Regarding the auto market in July, CAAM analyzed that in July, the auto market entered the traditional sales off-season, with foot traffic and orders naturally pulling back. Coupled with factors such as some demand being released early due to the mid-year sales push, persistent nationwide high temperatures, and typhoons and flood disasters in some regions affecting offline sales, the market showed a seasonal pullback on a MoM basis and edged down YoY. Exports continued to maintain rapid growth, with monthly exports exceeding 1 million units for two consecutive months, and the share of NEV exports exceeding 50% for two consecutive months; the share of NEVs in monthly new-car sales exceeded 60% for the first time, and the cumulative share exceeded 50% for the first time. On July 30, the Political Bureau of the CPC Central Committee convened a meeting to deploy economic work for H2, explicitly proposing to implement a more proactive fiscal policy and a moderately accommodative monetary policy, fully leverage the effectiveness of existing policies, and promptly plan and introduce pragmatic and effective incremental policy, while stepping up countercyclical adjustments. It called for effectively expanding domestic demand and fostering a fair and orderly market competition environment. The meeting made a series of important deployments, releasing multiple positive signals that will help stabilize confidence, boost consumption, and promote the steady operation of the industry. Meanwhile, the CPCA also released relevant data for the passenger car market in July. In July 2026, nationwide passenger car market retail sales were 1.461 million units, down 20.9% YoY and down 8.8% MoM; cumulative retail sales since the beginning of this year were 10.173 million units, down 20.3% YoY. In July 2026, China’s passenger car market showed an operating trend of “total volume remaining under pressure, weakening MoM, and an extremely polarized structure,” with the off-season downturn becoming more pronounced and the industry’s structural adjustment further deepening. For passenger NEVs, in July, passenger NEV market retail sales were 951,000 units, down 3.9% YoY and down 5.8% MoM; from January to July, passenger NEV market retail sales were 5.668 million units, down 12.5% YoY. In July, retail sales of conventional fuel passenger cars were 510,000 units, down 41% YoY and down 14.2% MoM; among them, regular hybrid car models were down only 4% YoY and down 5% MoM. In terms of NEV exports, in July, passenger NEV exports were 540,000 units, up 147.8% YoY and up 8.1% MoM . They accounted for 58.8% of passenger car exports, up 14 percentage points compared to the same period last year; among them, BEVs accounted for 59.5% of NEV exports (65.1% in the same period last year), and A00+A0-class BEVs, the core focus, accounted for 42.2% of BEV exports (36.6% in the same period last year). As the scale advantage of China’s NEVs becomes evident and market expansion needs grow, new energy brand products made in China are increasingly going global, with recognition outside China continuing to rise. Among them, narrow PHEVs accounted for 35.9% of new energy exports (32.4% in the same period last year), and range-extended vehicles accounted for 4.6% (2.5% in the same period last year). Although there have recently been some disruptions from external countries, exports of domestically branded narrow PHEVs to developing countries have grown rapidly, with a promising outlook. The CPCA stated that in July 2026, China’s passenger vehicle market showed an operating trend of “overall volume remaining under pressure, weakening MoM, and extremely polarized structure,” with the off-season downturn becoming more pronounced and the industry’s structural adjustment further deepening. The weakening auto market in July 2026 resulted from the combined resonance of multiple factors, including a rebound in oil prices, macro weakness, the seasonal off-season, earlier demand being pulled forward, and policy transitions. Geopolitical conflicts disrupted navigation through the Strait of Hormuz, driving international oil prices to drift higher; in 2026, China’s domestic gasoline prices were cumulatively raised by 1,575 yuan/mt, significantly increasing driving costs. Consumer demand for internal combustion engine passenger vehicles contracted sharply, while the impact on commercial vehicles was minimal. Meanwhile, July CPI and PPI pulled back MoM and PMI sentiment weakened; residents’ income and consumption expectations were relatively cautious, willingness to purchase big-ticket durables remained subdued, and spending on housing and travel continued to weaken, dragging down end-use demand in the auto market. In addition, the July off-season high temperatures suppressed offline store traffic, and June’s mid-year sales push pulled demand forward, causing terminal orders and foot traffic to pull back in tandem. Moreover, the new national safety standard for new energy was formally implemented, raising the industry’s technical threshold, and the short-term exit the market of low-end car models disrupted the market. However, the July Politburo meeting made clear stronger fiscal support and intensified policies to expand domestic demand and boost consumption, providing a floor for the auto market; the current downturn is a phased, structural fluctuation rather than a trend-level deterioration of the industry. Overall, the passenger vehicle market in July 2026 showed five salient characteristics: (1) Overall volume remained under pressure and structural divergence was amplified to the extreme; “deep cooling in internal combustion engine vehicles and strong leadership by new energy” became the core market theme, and oil price fluctuations dictated the pace of “ICE-to-NEV substitution”; (2) Internal combustion engine vehicles contracted across the board, with pure ICE models nearly stalling while hybrid models were relatively resilient, leading to continued optimization of the internal structure of ICE vehicles; (3) The penetration rate of new energy continued to hit new highs, with compliant products under the new national standard launched in concentrated iterative cycles on the supply side, and the industry shifted comprehensively from price involution to value competition; (4) Exports continued to play a stabilizing role, effectively steadying automakers’ wholesale and capacity and easing pressure from weak domestic retail; (5) Industry inventory continued to be reduced in a healthy manner, with producer and channel inventory declines widening in tandem, overall inventory risks fully released, operating pressure easing steadily, and overall resilience partially recovering. Power batteries From January to July, China’s cumulative production of power batteries and ESS batteries totaled 1,286.9 Gwh, up 54.9% YoY. In July, China’s combined production of power batteries and ESS batteries was 218.0 Gwh, up 5.8% MoM, up 62.9% YoY . From January to July, China’s cumulative production of power and ESS batteries totaled 1,286.9 GWh, up 54.9% YoY on a cumulative basis. From January to July, China’s cumulative exports of power and ESS batteries reached 216.6 GWh, up 43.9% YoY on a cumulative basis In July, China’s combined exports of power and ESS batteries totaled 35.2 GWh, down 2.7% MoM , up 51.7% YoY , accounting for 19.0% of monthly sales. Of this total, power battery exports were 24.0 GWh, accounting for 68.0% of total exports, down 6.0% MoM and up 62.1% YoY; ESS battery exports were 11.3 GWh, accounting for 32.0% of total exports, up 4.9% MoM and up 33.4% YoY. From January to July, China’s cumulative exports of power and ESS batteries reached 216.6 GWh, up 43.9% YoY on a cumulative basis , accounting for 18.6% of cumulative sales. Of this total, cumulative power battery exports were 146.7 GWh, accounting for 67.7% of total exports, up 52.1% YoY on a cumulative basis; cumulative ESS battery exports were 69.9 GWh, accounting for 32.3% of total exports, up 29.3% YoY on a cumulative basis. From January to July, China’s cumulative power battery installations totaled 410.2 GWh, up 15.4% YoY on a cumulative basis In July, China’s power battery installations were 74.6 GWh, down 2.5% MoM , up 33.5% YoY. Of this total, ternary battery installations were 11.1 GWh, accounting for 14.9% of total installations, down 12.1% MoM and up 1.8% YoY; LFP battery installations were 63.1 GWh, accounting for 84.6% of total installations, down 1.0% MoM and up 40.5% YoY. From January to July, China’s cumulative power battery installations totaled 410.2 GWh, up 15.4% YoY on a cumulative basis. Of this total, cumulative ternary battery installations were 74.5 GWh, accounting for 18.2% of total installations, up 12.1% YoY on a cumulative basis; cumulative LFP battery installations were 335.1 GWh, accounting for 81.7% of total installations, up 16.0% YoY on a cumulative basis. In July, Leap Motor Deliveries Surpassed 100,000; BYD’s Overseas Sales Hit Another Record High Among new automakers in July, Leap Motor continued to gain momentum, with deliveries reaching 101,267 units in July , up 102% YoY, surpassing the 100,000 mark for the first time on a monthly basis , becoming the first new automaker brand in China to achieve monthly deliveries exceeding 100,000 units, and ranking among the leaders across the entire new energy industry. The second-ranked NEV startup automaker was XPeng Group. In July, XPeng Group delivered a total of 38,027 vehicles, up about 4% YoY . As of July, XPeng Group’s cumulative global deliveries surpassed 1.2 million units. In terms of charging stations, as of July 31, XPeng charging covered 430 cities, with more than 3,800 cumulative self-operated charging stations, including over 3,300 self-operated ultra-fast charging stations, continuously providing users with a more convenient and efficient charging experience. NIO delivered a total of 35,934 vehicles in July, up 71.0% YoY. Of these, the NIO brand delivered 20,008 vehicles, up 57.9% YoY; the ONVO brand delivered 10,155 vehicles, up 69.9% YoY; and the firefly brand delivered 5,771 vehicles, up 143.9% YoY. In the first seven months of 2026, NIO delivered a total of 227,057 vehicles, a record high, up 68.0% YoY, with all three brands setting record highs in deliveries over the first seven months. The NIO brand delivered 139,496 vehicles, up 60.1% YoY; the ONVO brand delivered 52,618 vehicles, up 39.1% YoY; and the firefly brand delivered 34,943 vehicles, up 242.3% YoY. To date, NIO has delivered a cumulative total of 1,224,649 vehicles. Li Auto delivered 30,468 vehicles in July. As of July 31, 2026, Li Auto’s cumulative historical deliveries totaled 1,764,155 vehicles. Li Auto said that as of July 31, 2026, it had 490 retail centers nationwide, covering 159 cities; and 536 after-sales maintenance centers and authorized service centers, covering 219 cities. Li Auto had put into use 4,141 Li Auto supercharging stations nationwide, with 22,841 charging piles. As for Xiaomi Auto, its July deliveries again exceeded 30,000 units. To date, Xiaomi Auto has delivered more than 30,000 units for four consecutive months. Notably, since officially entering the automotive market in 2024, Xiaomi Auto has launched two car models, including the SU7 and YU7. As of month-end July, the two car models had delivered a cumulative total of over 700,000 units. As for EV leader BYD, its July sales reached 419,211 units, with exports of nearly 180,000 units, setting another record high. From January to July 2026, cumulative sales totaled 2,227,722 units, and cumulative NEV sales exceeded 17.3 million units. In July 2026, BYD exported 180,538 NEVs. In the same month, NEV production was 420,249 units, versus 317,892 units in the same period last year; cumulative production this year totaled 2,234,379 units, versus 2,454,925 units last year, down 8.98% on a cumulative YoY basis. Sales totaled 419,211 units, versus 344,296 in the same period last year; cumulative sales this year reached 2,227,722 units, versus 2,490,250 last year, down 10.54% YoY on a cumulative basis. Looking ahead to August, the CPCA expected the overall passenger car market in August 2026 to show an operating pattern of “weak recovery in total volume and sharp structural divergence.” With 21 production-and-sales working days compounded by the off-season of extreme heat, the end-use market’s recovery pace remained mild, and a mix of macro and industry factors jointly shaped the market landscape. Affected by disruptions to navigation through the Strait of Hormuz, international oil prices drifted higher in July, and China’s refined oil prices were raised by nearly 985 yuan/mt in total across two rounds, significantly lifting the costs of using and maintaining internal combustion engine vehicles and continuing to suppress users’ willingness to purchase them. Demand for traditional internal combustion engine vehicles continued to weaken, which also became a key external tailwind for new energy vehicles to strengthen against the trend, continuously expanding growth room for new energy car models in China and in markets outside China. Overall, the CPCA expected the auto market in August to be in a bottoming phase of rebuilding momentum and recovery. As various policies to stabilize consumption were gradually implemented, together with a gradual improvement in the base effect, the decline in the passenger car market was expected to narrow steadily, and the industry was set to formally enter a mature development stage of “value-driven growth and structural optimization,” building momentum and paving the way for the traditional September-October peak season.

This week, ferrous metals trended mostly higher, with performance varying slightly among varieties. Coking coal and coke were the strongest performers, while iron ore and finished steel posted relatively limited gains. During the week, safety supervision remained stringent, the pace of production resumptions at coal mines fell short of expectations, and structural shortages of coking coal grades further deepened, leading coking coal futures to continue rising. Coking plants suffered heavy losses...

[ SMM Stainless Steel Daily Review ] Pre-Season Warm-Up Falls Short of Expectations, Stainless Steel Spot and Futures Prices Weaken According to SMM on August 21, SS futures further declined and pulled back, continuing the overall downward trend. Despite the stronger performance of SHFE nickel, SS continued its previous pullback. By the close, the most-traded SS contract settled at 14,330 yuan/mt. On the spot market side, dragged down by the further decline in SS futures, although the traditional September-October peak season is approaching, downstream demand has yet to recover. Bearish sentiment in the market continues to ferment, and under the pressure of shipments, stainless steel spot prices further followed the downtrend. SS futures most-traded contract. At 10:15 AM, SS2610 was reported at 14,205 yuan/mt, down 140 yuan/mt from the previous trading day. The spot premiums for 304/2B in Wuxi ranged from 375,415 to 665 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coil in Wuxi fell by 50 yuan/mt; cold-rolled bare 304/2B coil in Wuxi fell by 50 yuan/mt on average, and in Foshan fell by 50 yuan/mt on average; the price of cold-rolled 316L/2B coil in Wuxi rose by 100 yuan/mt; hot-rolled 316L/NO.1 coil in Wuxi was flat; cold-rolled 430/2B coil in both Wuxi and Foshan was flat. This week, stainless steel futures overall consolidated at lows. Previously, impacted by news of an increase in Indonesia's RKAB nickel ore quota, SS futures fell sharply, and the overall market valuation pulled back to relatively low levels. This week, driven by the overall recovery in nonferrous metals, the futures market saw a staged rebound, but the previous...

SMM, August 21 – Metal Market: By the midday close, base metals in the domestic market broadly gained. SHFE copper rose 0.36%, SHFE aluminum rose 0.11%. SHFE lead rose 1.22%. SHFE zinc rose 1.38%. SHFE tin rose 0.92%. SHFE nickel fell 0.67%. In addition, the most-traded aluminum alloy futures rose 0.17%, the most-traded alumina futures rose 0.82%. The most-traded lithium carbonate futures rose 3.61%. The most-traded silicon metal futures rose 0.23%. The most-traded polysilicon futures rose 2.28%. Ferrous metals showed mixed performance. Iron ore edged down, rebar rose 0.43%, hot-rolled coil rose 0.18%. Stainless steel fell 1.18%. On coking coal and coke: the most-traded coking coal contract fell 0.35%, the most-traded coke contract rose 1.57%. On base metals in overseas markets, as of 11:40, LME metals all rose. LME copper rose 0.51%, LME aluminum rose 0.64%. LME lead rose0.29%, LME zinc rose0.8%. LME tin rose0.36%. LME nickel edged up. On precious metals, as of 11:40, COMEX gold rose 0.34%, hitting a new high since May at $4,600.3/oz during the session; COMEX silver rose 1.06%. In domestic precious metals: SHFE gold rose 1.22%, the most-traded SHFE silver contract rose 4.07%. Also, by the midday close, the most-traded platinum futures rose 3.58%, the most-traded palladium futures rose 1.79%. By the midday close, the most-traded Europe route container shipping futures contract rose 8.96%, at 1,910 points. As of 11:40 on August 21, partial futures midday quotations: Spot Market and Fundamentals Silver: The US Treasury's expansion of long-term bond buyback scale pushed the US dollar weaker, silver prices rebounded, but rising US Treasury yields and hawkish signals limited the gains. High silver prices continued to suppress demand in the spot market, with trading sluggish... Macro Front China: [Ministry of Finance: The ministry will promptly plan and introduce pragmatic and effective incremental policies in H2] Liao Min, Vice Minister of Finance, stated at a press conference on August 21 of the "Starting the 15th Five-Year Plan" series hosted by the State Council Information Office that since the beginning of this year, the Ministry has adopted multiple measures to continue supporting and encouraging consumption. It allocated 187.5 billion yuan for consumer goods trade-in, driving approximately 1.32 trillion yuan in sales of related goods, benefiting 178 million person-times. It innovatively launched a package of fiscal-financial coordination policies to boost domestic demand, targeting resident consumption and consumer industry operators, leveraging both the supply and demand sides. This policy has already benefited 113 million person-times. In 50 pilot cities, a receipt lottery campaign was launched, driving sales in related sectors to exceed 370 billion yuan. In H2, fiscal policy will continue to focus on accelerating fund utilization, boosting domestic demand, and strengthening fiscal reform and management to deliver tangible results. Regarding incremental policies, the Ministry of Finance will promptly formulate and introduce practical and effective incremental policies based on the macroeconomic conditions in H2, providing strong support for achieving an effective improvement in economic quality and a reasonable growth in quantity. (Xinhua News Agency) [National Energy Administration: China's total electricity consumption up 4.7% YoY in January-July 2026] On August 21, the National Energy Administration released data on total electricity consumption for July and the first seven months. From January to July, total electricity consumption reached 6,139.9 billion kWh, up 4.7% YoY. By sector, primary industry consumption was 87.7 billion kWh, up 3.5% YoY. Secondary industry consumption was 3,917.3 billion kWh, up 4.7% YoY, with industrial consumption at 3,881.5 billion kWh (up 4.9% YoY) and high-tech and equipment manufacturing consumption at 722.8 billion kWh (up 9.7% YoY). Tertiary industry consumption was 1,210 billion kWh, up 7.4% YoY, of which charging and battery swapping services and internet data services consumed 97.4 billion kWh and 59.3 billion kWh respectively, with growth rates of 55.8% and 43.3%. Urban and rural residential consumption was 924.9 billion kWh, up 1.3% YoY. (National Energy Administration) [PBOC conducts reverse repo operations, posting net injection of 95 billion yuan today and net withdrawal of 272 billion yuan this week] The PBOC conducted 95 billion yuan in overnight reverse repos today, with no reverse repos maturing, resulting in a net injection of 95 billion yuan. This week, the PBOC conducted a total of 1,457.6 billion yuan in reverse repo operations. With 18 billion yuan in 7-day reverse repos and 1,711.6 billion yuan in overnight reverse repos maturing this week, the net withdrawal was 212 billion yuan. (Jin10 Data APP) On the US dollar front: As of 11:40, the US dollar index fell 0.11% to 98.76. Citigroup's foreign exchange strategists turned bearish on the US dollar's short-term outlook, as the market prepares for a more dovish US Fed, the US midterm elections, and a further expansion of US Treasury buyback scale by the US Treasury. The Citigroup strategist team led by Daniel Tobon said they had lowered their US dollar index forecast for the next three months from 102.12 to 98.34. Citigroup had previously noted that US Treasury Secretary Bessent's recent move to lower long-term borrowing costs by expanding the buyback of US Treasuries with maturities from 10 to 30 years could come at the expense of the US dollar. The US dollar index, after falling to its lowest level since May on Wednesday, was basically flat near 98.9 on Thursday. Citigroup's team stated that their view on the dollar has been "relatively neutral" in recent months, but they have warned that risks to the dollar in the coming months could increase. US Treasury Secretary Bessent said on bond buybacks that the scale of a single buyback (upper limit) could exceed $4 billion, partly to send a signal. He said, "We want to show that yields do not reflect fundamentals." Meanwhile, he said the government may announce increased fiscal consolidation efforts, and it is highly likely that the deficit peak has already been seen. Regarding the debt figures, the $40 trillion debt number has no special meaning. The market is a bit too hasty. If there are any changes to the balance sheet, the Treasury and the Fed will cooperate. It needs to be clear that interest rates are unrelated to the buyback decision. On the inflation outlook, Bessent said market indicators point to lower inflation ahead. Regarding economic sanctions on Iran, Bessent said a press conference will be held next Monday to discuss related actions. The use of the Federal Reserve's reverse repo facility (RRP), open to foreign central banks and other monetary authorities, has continued to climb, with the balance growing for two consecutive weeks, reflecting that foreign official institutions are continuing to increase their US dollar cash reserves. As of August 19, the amount of foreign entities' funds parked in the Fed's reverse repo pool rose to $373 billion, up from $357 billion a week earlier. Since August 5, the facility's usage has increased by approximately $56 billion in total, the largest two-week increase since October 2022. The market is closely watching changes in foreign RRP balances for signs of whether Japan, after intervening in the foreign exchange market to support the yen last month, is re-accumulating US dollar liquidity. According to the CME "FedWatch": The probability of the Fed holding rates unchanged in September is 63.8%, and the probability of a cumulative 25-basis-point rate hike is 36.2%. The probability of the Fed holding rates unchanged in October is 51.8%, the probability of a cumulative 25-basis-point rate hike is 41.4%, and the probability of a cumulative 50-basis-point rate hike is 6.8%. (Jin Shi Data APP) Data side: Today's releases include the UK July public sector net borrowing, UK July retail sales month-on-month (seasonally adjusted), France August manufacturing PMI preliminary, Germany August manufacturing PMI preliminary, Eurozone August manufacturing PMI preliminary, UK August manufacturing PMI preliminary, UK August services PMI preliminary, Canada June retail sales month-on-month, US August S&P Global manufacturing PMI preliminary, global services PMI preliminary, Eurozone August consumer confidence index preliminary, China July total social electricity consumption YoY, and China July installed power generation capacity year-to-date. In addition, note: Hang Seng Indexes Company announced the review results of the Hang Seng Index Series for Q2 2026. Crude oil: As of 11:40, oil prices in both markets edged down, with WTI down 0.43% and Brent down 0.27%. As the US-Iran peace talks remained stalled, the security situation in the Middle East grew increasingly severe, and vessel traffic through the Strait of Hormuz on Thursday declined from the previous day. Preliminary data from vessel-tracking company Kpler showed that a total of seven cargo ships transited the Strait of Hormuz on Thursday, below 14 on Wednesday; among them, four vessels entered the strait and three exited. The data showed that no Very Large Crude Carriers (VLCCs) or liquefied natural gas (LNG) carriers passed through this narrow sea lane on Thursday. However, a very large gas carrier transporting propane and butane exited the strait via an Iranian route. (Jin10 Data APP) Spot market snapshot: ► ► ► ► ► ► ► ► ► ► ► ► ► ► ►

SMM August 21 News: Metal Market: Overnight, base metals in the domestic market generally rose. SHFE copper edged up 0.01%. SHFE aluminum fell 0.47%. SHFE lead rose 1.1%. SHFE zinc rose 0.78%, and SHFE tin rose 0.75%. SHFE nickel fell 0.96%. Additionally, the most-traded alumina futures rose 0.45%, while the most-traded primary aluminum contract fell 0.33%. Overnight, ferrous metals mostly fell. Stainless steel fell 1.39%, iron ore edged up, and rebar rose 0.3%. Hot-rolled coil fell 0.12%. For coking coal and coke: the most-traded coking coal contract fell 1.48%, and the most-traded coke contract fell 0.02%. Overnight in overseas markets, LME base metals showed mixed performance. LME copper edged down, LME aluminum fell 1.62%. LME lead rose 0.72%. LME zinc rose 0.92%. LME tin rose 0.77%. LME nickel fell 1.08%. Overnight precious metals : COMEX gold rose 0.66%, hitting an intraday high of $4,597.1/oz; COMEX silver rose 3.5%. Overnight, the most-traded SHFE gold contract rose 1.03%, and the most-traded SHFE silver contract rose 2.97%. As of 7:16 a.m. on August 21, overnight closing prices: Macro Front China: [Shanghai: By the end of 2026, fully launch overall renovation projects of urban villages and fully complete remediation] The General Office of Shanghai Municipal People's Government issued the "15th Five-Year Plan for Urban Renewal and Housing Development in Shanghai." It proposes accelerating the renovation of urban villages, fully utilizing special loans for urban village renovation and local government special bonds, and increasing fiscal investment. It also aims to expedite relocation and land vacation, actively promote diversified resettlement such as housing vouchers. By the end of 2026, fully launch overall renovation projects of urban villages and fully complete remediation. By the end of 2027, fully complete preliminary renovation of overall renovation projects. Simultaneously, implement planning-based point removal. Accelerate comprehensive renovation of old public housing, through demolition and reconstruction, old city renovation, functional replacement, and other methods to renovate non-complete staff residential buildings, actively improve public housing rental rights collection and relocation update pathways. By the end of 2026, strive to fully complete the renovation of the remaining approximately 20,000 m² of small-beam thin-slab housing. By the end of 2030, strive to basically complete the renovation of non-complete staff residential buildings, achieve positive results in the renovation of non-complete lane, apartment, and garden houses, and promote the implementation of a batch of urban renewal projects that combine livelihood improvement and conservation development. [Shanghai International Energy Exchange further expands tradable product range for qualified foreign investors, newly opens low-sulfur fuel oil options] Shanghai International Energy Exchange announced that, with the approval of the China Securities Regulatory Commission, starting from September 10, 2026 (i.e., opening at 9:00 a.m. that day), the Shanghai International Energy Exchange will further expand the tradable product range for Qualified Foreign Institutional Investors and Renminbi Qualified Foreign Institutional Investors (collectively referred to as Qualified Foreign Investors), and newly open the following commodity options: low-sulfur fuel oil options. US dollar side: Overnight, the US dollar index rose 0.08% to 98.87. According to the CME "FedWatch": The probability of the US Fed keeping interest rates unchanged at September stands at 63.8%, while the probability of a cumulative 25-basis-point rate hike is 36.2%. For October, the probability of the US Fed keeping rates unchanged is 51.8%, the probability of a cumulative 25-basis-point hike is 41.4%, and the probability of a cumulative 50-basis-point hike is 6.8%. In addition, Fed Chairman Warsh will deliver a speech at Jackson Hole at 10:00 a.m. Eastern Time on August 28 (10:00 p.m. Beijing time on August 28). Fed Daly said that the rise in long-term yields is a global issue, weakening its signaling role for Fed policy, and he believes there is no risk to the Fed's credibility. Short-term yields indicate that the market understands the Fed's reaction function, and that Fed policy is in good shape, with no evidence seen of needing to raise rates early. He expects the inflation shock will gradually fade, so he is "very supportive" of the Fed's decision to keep rates unchanged in July. However, one needs to be cautious about the cumulative effect of multiple inflation shocks, although he is looking for more concerning signs of inflation but has not seen them yet. Recent employment and inflation data have not changed the outlook, and he does not currently believe the labor market will drive inflation. The rise in bond yields has not sent a policy signal, and it is too early to discuss the Treasury issuance model. The Fed will find ways to achieve its policy objectives. The Fed will continue to fulfill its duties regardless of Treasury actions. US Treasury Secretary Bessent, on the issue of bond buybacks, said that a single buyback operation could exceed $4 billion in size (upper limit), partly as a signal. They want to show that yields do not reflect fundamentals. At the same time, they may announce a greater fiscal consolidation effort, and it is very likely they have already seen the peak in deficits. As for the debt figure, the $40 trillion debt number has no special significance. The market is a bit ahead of itself. If there are any changes in the balance sheet, the Treasury and the Fed will coordinate. To be clear, interest rates have nothing to do with the buyback decision. On the inflation outlook, Bessent said that market indicators point to lower readings ahead. On economic sanctions against Iran, Bessent said that a press conference will be held next Monday to discuss related actions. Citigroup's foreign exchange strategists have turned bearish on the short-term outlook for the US dollar, as the market is preparing for a more dovish Fed, the US midterm elections, and the Treasury's further expansion of Treasury buyback operations. The Citi strategist team, led by Daniel Tobon, said it has lowered its 3-month US dollar index forecast from 102.12 to 98.34. Citi previously noted that US Treasury Secretary Bessent's recent move to lower long-term borrowing costs by expanding the scale of repurchases of 10-year to 30-year US Treasury bonds could come at a cost to the US dollar. The US dollar index fell to its lowest level since May on Wednesday and then was basically flat around 98.9 on Thursday. The Citi team said they have maintained a "relatively neutral" view on the US dollar in recent months but have warned that risks to the US dollar could increase in the coming months. (Jin10 Data APP) On the macro front: Today will see the release of UK public sector net borrowing in July, UK July seasonally adjusted month-on-month retail sales, France August manufacturing PMI preliminary, Germany August manufacturing PMI preliminary, Eurozone August manufacturing PMI preliminary, UK August manufacturing PMI preliminary, UK August services PMI preliminary, Canada June month-on-month retail sales, US August S&P Global manufacturing PMI preliminary, Global services PMI preliminary, Eurozone August consumer confidence index preliminary, China July total social electricity consumption YoY, and China's year-to-date July national installed power generation capacity. In addition, attention should be paid to: Hang Seng Indexes Company will announce the results of the Hang Seng Index series review for Q2 2026. On crude oil: Both crude oil futures extended their gains for a fourth consecutive trading session overnight, with WTI crude up 2.16% and Brent crude up 1.77%. Oil prices surged due to Trump's threat of sanctions on Iran. As mentioned by Wall Street Sights, citing CCTV, Bessent revealed that a press conference will be held on August 24, next Monday, to elaborate on the US action plan against Iran. Bessent hinted that increasing economic pressure could be an important means to avoid restarting large-scale military operations. CCTV quoted him as saying: "We have asymmetric information. I'm not sure why oil issues have become the focus. If we apply maximum economic pressure, it means that large-scale military conflict is less likely." UBS analyst Giovanni Staunovo said: "Tensions in the Middle East remain high, leaving room for further supply disruptions. The decline in Middle East crude exports is tightening the oil market." (Wall Street Sights) NYMEX New York crude oil September futures, affected by contract rollover, will conduct its last floor trading at 2:30 AM on August 21 and its last electronic trading at 5:00 AM. Please pay attention to the contract rollover announcements of the trading venues to control risks. In addition, the expiration time of US crude oil contracts on some trading platforms is usually one day earlier than the official NYMEX time. Please be cautious.

SMM August 20 News: Domestic Bauxite: Domestic Ore Supply Disruptions Continue, Mainstream Prices Remain Stable Affected by the Shanxi coking coal incident, mining at major domestic bauxite production areas such as Shanxi and Henan has experienced some disruptions in the short term, leading to phased changes in ore supply. Meanwhile, alumina prices remain at a relatively high level, and alumina refineries have moderate tolerance for raw material price increases, mostly passively accepting current ore prices for now. As of today, transaction prices for bauxite with an Al/Si ratio of 5 and 60% alumina content in Shanxi are around 530-550 yuan/mt EXW at crushing plants excluding VAT; in Henan, prices for similar specifications are around 500-540 yuan/mt EXW; in Guiyang, prices for bauxite with an Al/Si ratio of 6 and 60% alumina content are 490-540 yuan/mt EXW price including VAT; in Guangxi, prices for bauxite with an Al/Si ratio of 6 and 53% alumina content are 320-335 yuan/mt EXW at crushing plants excluding VAT. Imported Bauxite: Bauxite Price Hikes Fell Short of Early-Month Expectations, Upstream Import Ore Quotes Slightly Down Data as of August 14 showed that total weekly port departures of bauxite from major ports in Guinea were 4.6891 million mt, up 12,800 mt from the previous week, with shipments basically stable. Due to renewed tensions in the US-Iran situation, oil prices rebounded again, and ocean freight rates from Guinea to China followed with an upward trend. Market quotes rose to around 37-38 $/dmt, and mine costs continued to increase to varying degrees. Combined with policy uncertainties in Guinea and weather-related transport disruptions, Guinean mines tightened control over bauxite shipments. For Australia, as of August 14, weekly port departures from major Australian ports totaled 1.1008 million mt, up 174,000 mt from the previous week, with shipments basically flat. Going forward, attention should be paid to the pace of shipments from Australian mines and changes in port shipments. As of August 14, China's bauxite port arrivals totaled 4.8239 million mt, down 402,800 mt from the previous week. Continued attention is needed on the impact of oil price and ocean freight rate fluctuations on future arrival pace and landed costs. Price-wise, Guinea's August long-term contract quotes for bauxite were in the range of 73-74 $/mt, but downstream price acceptance was relatively limited. Meanwhile, bauxite inventories at China's alumina refineries remain at a high level. This week, alumina refinery bauxite inventories were relatively stable, with days of inventories around 96 days, putting some upward pressure on ore prices. For Guinean bauxite, transportation costs from Guinea to China rebounded, mine costs increased, and the traditional rainy season along with adverse weather caused shipment reductions. As a result, upstream and trader quotations did not meet early-month expectations, slightly declining to a high price range of $72-73/mt. Under the dual impact of persistently high inventory and shrinking profits, China's alumina refineries maintained their intended transaction prices in the $70-71/mt range. The divergence between upstream and downstream in the bauxite market remained significant, with transaction activity slowing down, and the stalemate continuing since last week. As of Thursday this week, the FOB quotation for Guinean bauxite was $36-44/mt, flat WoW; the CIF price was $70-73/mt, down $0.5/mt WoW; and the SMM imported bauxite index price stood at $71.99/mt, up $0.27/mt WoW. Moving forward, bauxite prices will still depend on mine costs, the impact of Guinea's traditional rainy season and the government's bauxite export quota policy on overall shipments. SMM will continue to closely monitor the bauxite market trends and transaction conditions. Overall, domestic ore prices remained at current levels. Meanwhile, China's alumina refineries' inventories remained high (about 96 days), and the price negotiation between buyers and sellers persisted. The uncertainty of Guinea's quota policy, shipment decreases, and the traditional rainy season also brought certain upward pressure on bauxite costs. In the short term, due to the dual impact of costs and policies leading to reduced shipments, imported ore prices are expected to remain in a high-level stalemate. Subsequently, close attention should be paid to the implementation of Guinea's quota policy and ocean freight rate trends.

This week, macro signals were mixed. Early on, surging Treasury yields and hawkish Fed expectations weighed on precious metals. Mid-week, the Treasury expanded buybacks, pulling long-end yields lower and sparking a rebound. Yields remain high and the Fed’s hawkish tilt keeps downside risks alive, but debt concerns and central bank buying offer solid medium-term support. Focus shifts to Jackson Hole and US-Iran developments.

August 20, SMM News: Base metals: At midday close, most base metals on the domestic market rose. SHFE copper rose 0.36%, SHFE aluminum fell 0.57%. SHFE lead rose 0.28%. SHFE zinc edged down. SHFE tin rose 1.68%. SHFE nickel rose 1.19%. Additionally, the most-traded cast aluminum futures edged up, while the most-traded alumina contract fell 0.3%. The most-traded lithium carbonate contract rose 0.98%. The most-traded silicon metal contract rose 0.57%. The most-traded polysilicon futures rose 0.48%. Ferrous metals showed mixed performance. Iron ore fell 2.17%, rebar fell 0.46%, and hot-rolled coil fell 0.27%. Stainless steel rose 0.63%. Coking coal and coke: the most-traded coking coal contract rose 0.25%, and the most-traded coke contract rose 1.12%. On the overseas market base metals side, as of 11:40, LME metals generally rose. LME copper, LME lead, and LME zinc each gained less than 0.3%. LME aluminum fell 0.79%. LME tin rose 0.73%. LME nickel fell 0.64%. Precious metals, as of 11:40, COMEX gold rose 0.11%, COMEX silver rose 2.11%. Domestic precious metals: SHFE gold rose 2.47%, the most-traded SHFE silver contract rose 4.93%. Additionally, at midday close, the most-traded platinum futures rose 4.52%, and the most-traded palladium futures rose 2.44%. At midday close, the most-traded Europe container shipping futures fell 1.46% to 1,716.5 points. As of 11:40 on August 20, noon quotes for some futures: Spot market & fundamentals Aluminum: Today the futures market continued its decline, but the south China spot market was steady with improvement. The cumulative decline in absolute prices had been substantial, clearly breaking below the monthly moving average. Coupled with stable inventory draws and a significant single-day decline, these dual positives prompted holders to generally hold back from selling more firmly... Macro front China: [Unchanged for the 15th consecutive month! August LPR quotes released: 5-year above 3.5%, 1-year 3%] China's August loan prime rate (LPR) was released on August 20, with both 1-year and 5-year above LPR unchanged. The People's Bank of China authorized the National Interbank Funding Center to announce that the loan prime rate (LPR) on August 20, 2026 is: 1-year LPR at 3.0%, 5-year above LPR at 3.5%. The above LPR is valid until the next LPR release. The 7-day reverse repo rate, as the main policy rate, has remained unchanged for 15 consecutive months since its cut in May 2025. Therefore, the pricing basis for LPR quotes has not changed this month. The LPR was last adjusted in May 2025, with both the 1-year and over-5-year LPR cut by 10 basis points. [Shanghai issues "Housing Eight Measures" for property market: Down payment for second homes outside the outer ring road reduced from 20% to 15%, and interim home purchase subsidy policy introduced] To better meet residents' rigid and improved housing needs and promote the stable and healthy development of the real estate market, on August 20, six departments including the Shanghai Municipal Commission of Housing and Urban-Rural Development Management, the Shanghai Municipal Housing Authority, the Shanghai Municipal Finance Bureau, the Shanghai Branch of the People's Bank of China, the Shanghai Financial Regulatory Bureau, and the Shanghai Housing Provident Fund Management Center jointly issued the 《Notice on Optimizing Local Real Estate Policy Measures》 (hereinafter referred to as the 《Notice》), effective from August 21, 2026. The 《Notice》 mainly includes 8 policy measures in 5 aspects: optimizing housing provident fund withdrawal, optimizing personal housing credit, implementing trade-in home purchase subsidies, promoting housing voucher placement, and advancing the acquisition of second-hand housing. [Beijing Yizhuang: Will accelerate the mass production of 100,000-unit level embodied AI robots] According to the "Beijing Yizhuang" official account, on August 19, the 2026 World Robot Conference opened in Beijing Yizhuang. At the "Open Cooperation" main forum, Li Quan, member of the Party Working Committee and Deputy Director of the Management Committee of the Beijing Economic-Technological Development Area, released the "Beijing Machine Domain"—a vision of building a new society of human-machine integrated embodied AI. Beijing Yizhuang will accelerate the development of 100 feature robot products that can be practically deployed, promote their application in 1,000 niche areas; accelerate the mass production of 100,000-unit level embodied AI robots, and form a production capacity of 1 million sets of key core parts. (from Wall Street News APP) The PBOC conducted zero 7-day reverse repo operations for 8 consecutive working days. Today, 327.4 billion yuan of reverse repos matured. US dollar side: As of 11:40, the US dollar index rose 0.03% to 98.83. US Fed meeting minutes showed that several officials last month leaned toward raising rates, while many said that if inflation failed to decline, further tightening of monetary policy would be necessary. However, at the July meeting, uncertainty continued to heavily influence Fed officials' judgment. The minutes showed: "Regarding the monetary policy outlook, participants reiterated that their interpretation of future data would be a key component of policy discussions." The FOMC voted 9 to 3 in July to keep the benchmark interest rate in the range of 3.5% to 3.75%. Logan, Hammack, and Kashkari voted against, advocating for a 25-basis-point rate hike. Two other regional Fed presidents who did not have voting rights in July—Schmid and Musalem—also later stated that if they had had voting rights at that time, they would have supported a rate hike at that meeting. Most of the policy discussions at the July meeting revolved around differing judgments on future inflation trends. The meeting minutes stated: "Most participants expected that inflation would gradually pull back over the remainder of the year as the effects of tariffs and earlier energy price increases faded, but many participants noted that the possibility of inflation remaining elevated persisted." According to the CME FedWatch: The probability of the US Fed keeping rates unchanged by September is 67.3%, and the probability of a cumulative 25-basis-point rate hike is 32.7%. The probability of the Fed keeping rates unchanged by October is 58.3%, the probability of a cumulative 25-basis-point hike is 37.3%, and the probability of a cumulative 50-basis-point hike is 4.3%. Four US Senate Democrats led by Chris Van Hollen have demanded that Fed Chairman Warsh publicly disclose the content of his conversations with Trump, after The Wall Street Journal reported that the two had spoken multiple times, even though Warsh's schedule did not show such calls. The senators said that without disclosing contact information, it could lead the public to mistakenly believe that the White House is steering monetary policy. Last month, under questioning by Van Hollen, Warsh did not directly respond to the matter. The senators demanded that Warsh confirm in writing whether he has had any contact with Trump since taking office, or amend his schedule to disclose relevant calls. In early August, White House National Economic Council Director Hassett downplayed these calls, saying that Trump did not pressure Warsh on rate decisions; and Trump himself said that he had only had one brief conversation with Warsh. In contrast, former Fed Chairman Powell had detailed records of his calls with Trump and disclosed several face-to-face meetings. The US Treasury issued a statement saying it will at least double the size of liquidity support repo operations targeting long-term nominal coupon securities, covering two maturity buckets: 10-to-20-year and 20-to-30-year tenors. The current maximum size per operation is $2 billion, and future operations will be at least $4 billion each. The adjustment will take effect on September 9, 2026, and will be implemented for the remainder of the current refunding quarter (through November 4, 2026). The Treasury will provide more information on future repo sizes at the next quarterly refunding meeting, scheduled for November 4, 2026. The expansion of the repurchase operation scale reflects the Ministry of Finance's intention to provide stronger liquidity support for the long-term nominal government bond market. The Ministry of Finance will announce the updated temporary government bond repurchase arrangements later. US Treasury Secretary Bessent this year has become one of the most interventionist Treasury secretaries in decades through a series of unconventional operations, aiming to curb the rise in US borrowing costs. This week, the US Treasury announced it would "at least double" its originally planned repurchase of 10-year to 30-year bonds. Previously, the Treasury had signaled a possible reduction in long-term debt issuance. On July 31, Bessent led the US government's first yen purchase in 30 years. Former Treasury official Mark Sobel commented that Bessent is "absolutely an aggressive interventionist," with a style reminiscent of his hedge fund background. He believes that Bessent and senior government officials are clearly concerned about rising long-term US Treasury yields. Affected by inflation, Fed monetary policy, and fiscal deficits, the 10-year US Treasury yield has been rising, pushing up mortgage rates and dragging down economic growth. Some analysts point out that Bessent is trying to stabilize the market through yield curve intervention, but also warn that without addressing high debt and fiscal deficits, this strategy is difficult to sustain in the long term. (Jin Shi Data APP) Data: Today, the following data will be released: Australia July seasonally adjusted unemployment rate, Germany July PPI month-on-month, Switzerland July trade balance, UK August CBI industrial order expectations, US initial jobless claims for the week ending August 15, US August Philadelphia Fed manufacturing index, US July Conference Board leading index month-on-month, China July year-to-date installed power generation capacity, China July year-to-date installed power generation capacity year-on-year rate, among others. In addition, attention should be paid to: the Ministry of Commerce's August first regular press conference; interview of 2028 FOMC voter and St. Louis Fed President Musalem by CNBC; Alibaba's earnings release. Crude oil: As of 11:40, both crude oil benchmarks moved sideways, with WTI up 0.05% and Brent up 0.23%. With US-Iran negotiations in a stalemate, oil prices moved sideways. According to CCTV News: On August 19 local time, US President Trump posted on his social media platform "Truth Social" that Iran failed to seize the opportunity to reach an agreement, so he announced the "harshest economic action ever taken against any country" against Iran, calling it an unprecedented "economic war and economic isolation." Trump said the US is building a record number of oil pipelines to reduce dependence on the Strait of Hormuz. He said that with the emergence of more alternative supply routes and the US strengthening its control over the strait, the importance of the Strait of Hormuz will decline. Trump also said that although some had predicted that oil prices could skyrocket to $350, current oil prices remain around $84 to $85 per barrel. Two US officials told Axios that the US military has quietly established a shipping lane through the Strait of Hormuz, carrying millions of barrels of oil daily. Although the broader war remains deadlocked, the operation has achieved significant results. The operation has been ongoing for weeks, and 15 to 20 tankers have already passed through the southern channel off the coast of Oman to enter or exit the Strait. Officials said that about 10 million barrels of oil are shipped through the strait daily and enter the global energy market, but this figure is about half of the pre-war volume. This US-led operation is alleviating one of the most severe impacts of the war: the disruption of oil supply, which has driven a sharp rise in crude oil prices. Officials stated that although the current volume of oil shipped through the strait is still below pre-war levels, it has already had a notable impact on global oil supply. (Jinshi Data) In addition, Venezuelan oil minister Paula Enao told investors in Houston that Venezuela hopes to sign production-sharing contracts and increase oil production in this country with the world's largest crude oil reserves. Enao said that Venezuela currently has 916 blocks available for exploration and production. She said Venezuela is known for heavy crude, but there are also investment opportunities in light and medium crude and natural gas. She said: "We need to reach these agreements to enter these new blocks." "There is a whole world waiting for you to explore." This week, Venezuela has signed agreements with oilfield services giant Schlumberger (SLB.N) and independent oil producer Hnt Oil, but the country hopes to attract more private investment to revive oil production. Over the past 20 years, Venezuela's oil production has been steadily declining. Enao said about 140 companies attended the meeting, and the scale of on-site investors showed the market's interest in investing in Venezuela. Spot Market Overview: ► ► ► ► ► ► ► ► ► ► ► ► ► ►

Published: Aug 19, 2026 - 1:48 AM (Kitco News) – Gold prices are getting a boost from falling rate hike expectations, but Asian investors and central banks never abandoned the yellow metal, and prices will gain an additional 11% between now and year-end, according to strategists at Wells Fargo Investment Institute. “After a challenging five months, gold is regaining momentum, supported by hopes for progress toward negotiations in the Middle East and by investors scaling back expectations for Fed rate hikes,” the strategists wrote in their latest report. “Gold prices rose more than 7% during the first week of August, marking the strongest weekly gain since January. ETF flows also improved, with outflows stabilizing and even beginning to reverse higher.” “Undoubtedly, gold has struggled since March 2026, as rising U.S. inflation-adjusted yields and concerns that inflation could pressure the Fed to raise interest rates make gold, which does not pay its holders interest, relatively less attractive against interest bearing assets,” they acknowledged. “However, despite gold’s weak performance we believe we continue to see several underlying strengths.” Wells Fargo pointed to resilient global demand through the first half of 2026 as a reason for optimism. “International investors have been especially constructive amid heightened geopolitical and market uncertainties, inflation risks, and relatively low interest rates in select key markets — such as China,” the analysts said. “While gold’s global spot price was down 5% through the first half of the year, Asian investors have actually been persistent purchasers, and when measuring gold’s performance during Asia’s trading hours the yellow metal is up 13%." "We believe these same geopolitical and market uncertainties reinforced gold’s role and supported the rebound in central bank purchases during the second quarter.” Looking ahead, Wells Fargo sees these strengths supporting continued gains for gold, and the firm reiterated their favorable outlook for the precious metals complex as a whole. “That said, we believe gold’s path higher will be uneven, as international demand is challenged by U.S. monetary headwinds,” they cautioned. “For these reasons, we remain favorable but revised our 2026 and 2027 year-end gold targets lower to 4,900–5,100 and 5,400–5,600 per troy ounce, respectively.” In a recent interview with Kitco News , Sameer Samana, Wells Fargo’s Head of Global Equities and Real Assets Strategy, said gold has now reached a point where the downside risks are becoming increasingly limited while the long-term upside remains compelling. "I think the risk-reward has flipped quite a bit since the peak," he said. "If the Fed funds futures market is embedding two to three hikes, then I think the price of gold is embedding two to three hikes." Samana said that after gold's more than 20% correction from its January record high, investors should shift their focus away from short-term volatility and instead evaluate the metal's longer-term risk-reward profile. He added that regardless of whether oil prices remain elevated or the Federal Reserve ultimately delivers additional rate hikes, much of that risk has already been reflected in gold prices. Samana believes investors now need to ask a different question: "What are the odds of something greater than two to three hikes? Inflation isn't that much of a problem where you would need significantly more tightening." Gold has struggled for months as renewed Middle East tensions have pushed oil prices higher, which in turn have fueled expectations that the Federal Reserve may be forced to tighten monetary policy. Rising real yields have increased the opportunity cost of holding non-yielding assets like gold. However, Samana argued that markets have likely become overly pessimistic. "The real question is whether the risk-reward is favorable for an exposure in your portfolio that's very hard to replicate elsewhere,” he said. “I think so.” Downside risk remains, but long-term trend is intact Samana acknowledged that the technical picture has yet to improve and warned investors against assuming the correction has fully run its course. “It’s hard to argue that gold has bottomed," he said. "In the near term, I think you probably have risk to the downside to $3,500," At the same time, he also noted that technical resistance is also likely to emerge between $4,500 and $4,900 as investors who bought near the highs look to exit losing positions. Despite those risks, Samana emphasized that investors should not lose sight of the bigger macroeconomic cycle. "When the dust settles, you'll be back to much of the same," he said. "Higher oil prices and higher interest rates are going to slow the economy, which will then cause central banks and fiscal authorities to come back in and do what they always do." That eventual slowdown, he said, would likely lead policymakers to cut interest rates again and potentially provide additional monetary support. "Could you see $3,500 before $4,500? It's possible," he said. "But unless you believe that longer-term cycle is over, then it really is just a matter of time before gold prices are higher." Gold remains valuable portfolio insurance Samana noted that gold has historically held up relatively well during economic downturns. Looking at recent recessions and periods of aggressive monetary tightening, he pointed out that gold's declines have generally been modest compared with many other asset classes. Even during the 2020 recession and the Fed's tightening cycle in 2018, gold experienced drawdowns of roughly 15%, while the 2008 financial crisis produced a decline closer to 34%. More importantly, prolonged bear markets in gold typically unfold over several years rather than in sharp collapses. Because gold has already corrected nearly 30% from its peak, Samana believes much of the potential damage has already been absorbed. "I think a lot of the pain has already been discounted in the price," he said. He added that gold continues to provide valuable diversification because it often performs well when traditional assets struggle. "This is an asset that does not work in every environment," he said. "But when stocks don't work and bonds don't work, there's a really good chance that gold is working." Source： https://www.kitco.com/news/article/2026-08-18/wells-fargo-reiterates-positive-outlook-precious-metals-still-sees-gold

[SMM Tin Morning Update: Night Session Rebounds to Reclaim 424,000, July FOMC Minutes Set the Tone for September Path]