Gold, silver see price gains as risk appetite slips

US buyers of copper will pay a high price if President Donald Trump pushes ahead with a 50% tariff on refined metal as opposed to copper products such as wiring, according to officials in Chile.

While Chile hasn’t received any formal notification and is unaware of the details of the measure, Mining Minister Aurora Williams noted that US manufacturing is dependent on Chilean copper.

Chile accounts for roughly 70% of copper shipped to the US, with state-owned Codelco representing most of that. Still, it would be US buyers — makers of intermediate forms of copper such as wires, rods and tubes — that would pay the levy. They would have little choice as America relies on imports for almost half of its copper needs.

Chile ships “top-notch refined copper with high levels of traceability, so we are interested in that being duly recognized not just in the US but the whole market,” the minister told reporters in Santiago on Thursday. “Chilean mining production, in all its gambits, has high responsibility, is highly valued and highly necessary for manufacturing in the US.”

Chile has been seeking a tariff exemption in its discussions with US officials, Williams said. “That is a topic that’s on the table.”

US buyers would incur higher costs if the tariff is applied to refined metal, Antofagasta Plc Chief Executive Officer Ivan Arriagada said on the sidelines of the same industry event.

“Undoubtedly that would put pressure on makers of copper products in the US, and so it is a concern,” he said.

For Chilean suppliers like Antofagasta, the US represents about a 10th of total copper sales. China is by far the biggest buyer.

The copper market is likely to remain volatile, Arriagada said. Once tariffs are introduced, consumers in the US would draw from stockpiles that have built up ahead of time, impacting demand.

Beyond that, “copper continues to be in relative scarcity,” he said.

Source: Bloomberg Europe

Source: investing

Oil futures sank as the escalating global trade war and the possibility that OPEC+ may halt output hikes flashed warning signs for energy demand.

West Texas Intermediate futures fell as much as 2.6% to trade below $67 a barrel after Bloomberg reported that the cartel is discussing a pause in further production increases from October. The early-stage deliberations are taking place as President Donald Trump unveils a new round of tariffs, including a 50% rate on Brazil, which sends some oil to the US.

Traders are probably interpreting the OPEC+ talks as a sign that “the market may not be able to cope with more oil,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “We are potentially seeing the risk of an oversupplied market” once the peak demand period ends, he said.

The US-led tariff war has intensified in recent days, and Trump’s latest salvo of demands has overshadowed earlier deals with major trade partners including China and the UK, which had served to mollify investors. Now, the market is facing some of the highest tariff rates in US history, setting the stage for an uncertain period for global growth.

Oil has edged higher this week even after OPEC+ decided over the weekend to raise output by more than expected in August. Energy Aspects said it expects global oil demand to rise by less than 1 million barrels a day in the third and fourth quarters amid pressure from US tariff policies.

Director of Market Intelligence Amrita Sen said the consultant was “worried about the fourth quarter and into 2026 because tariff talks are back.”

Timespreads also show that perceptions of strength in physical market are waning. While WTI’s prompt spread — the gap between its two nearest contracts — is still in a bullish, backwardated structure, the differential narrowed to $1.28 from as high as $1.57 earlier this week.

Meanwhile, Houthi attacks in the Red Sea have sunk two cargo vessels and left multiple crew members dead. The escalation has notably failed to inject a risk premium into oil prices, with investors reluctant to buy on geopolitical developments after a standoff between the US and Iran spared energy infrastructure.

Source: Yahoo Finance

Column chart showing the quarterly earnings growth rate for STOXX 600 companies

Source: Reuters

Brazil scrambled to respond to U.S. President Donald Trump’s announcement of 50% tariffs on Brazilian exports, with President Luiz Inacio Lula da Silva convening an urgent cabinet meeting on Thursday as officials worked to de-escalate the crisis.

Brazilian diplomacy "has always been available to the American government to seek a solution of greater partnership and greater understanding, as we have always done," Finance Minister Fernando Haddad told reporters on Thursday.

"I don't believe this situation will continue," he said, calling the tariffs announced by Trump on Wednesday "unsustainable."

Two government sources told Reuters that Lula is calibrating Brazil's response and is unlikely to announce concrete measures on Thursday. His chief of staff said the government is forming a working group to decide how to react.

While Lula said on Wednesday that Brazil would respond to any tariffs with reciprocal measures, the sources said diplomatic efforts were gaining traction within the government on Thursday.

The U.S. tariffs, slated to take effect on August 1, were tied by Trump to Brazil’s treatment of former President Jair Bolsonaro, who is standing trial before the country's Supreme Court under charges of plotting a coup to stop Lula from assuming office in 2023.

Haddad criticized Bolsonaro and Brazil’s far-right opposition for perpetuating claims of legal persecution against the former president. "This blow against Brazil, against national sovereignty, was orchestrated by extremist forces within the country," Haddad said. "Even the far right will have to admit sooner or later that it shot itself in the foot."

The U.S. is Brazil's second largest trading partner after China and has a rare trade surplus with world's top economic power.

The tariffs could have a significant impact on food prices in the U.S., experts say, with the South American agricultural powerhouse being a major seller of coffee, orange juice, sugar, beef and ethanol to the U.S., among other products.

Brazil's real weakened as much as 2% against the U.S. dollar in spot trading on Thursday, before paring some losses to trade down 0.7%. Benchmark stock index Bovespa slipped 0.7%, with planemaker Embraer and meatpacker Minerva among the biggest fallers.

Source: Yahoo Finance