Prices & Review

Overview (September 2025)

Base metals delivered a mixed performance in September. Copper and zinc trended higher, while the others have either been volatile, or stuck in sideways trading ranges.

Macro-economic data has also been mixed, but expectations of — and the subsequent response to — a US rate cut provided support, with equities buoyant and many indices reaching new record highs in September.

Copper rallying at the end of the month after three large mines facing problems in Chile, Indonesia and DRC. Zinc gained support due to the continued decline in LME stocks to exceptionally low levels. Gold rallied as its core drivers remained strong, while silver attracted fresh interest as investors finally seem to have recognized it had lagged behind gold. Precious metals also benefited from easing US-ten-year treasury yields, falling to 4.14 percent in late-September, from 4.26 percent in early-September. The gold/silver ratio fell to 1:85 in September, having been over 1:100 in April and May. Silver is still below the all-time highs seen in 1980 and 2011, when prices reached around the $50 per oz level. $50 in 1980 when the Hunt family tried to corner the Silver market.

The economic climate is for the most part looking uncertain as the fallout from US tariffs has yet to show up in the data, although the deterioration in September’s flash PMI data may be an early warning sign. The US labor market has also weakened with August’s payrolls data showing only 22,000 jobs created, which was the slowest pace this year and the unemployment rate has climbed to 4.3 percent, from 3.7 percent at the start of 2024. With China’s economy witnessing deflation and a deteriorating real estate market and the Euro zone’s economy stalling, with Q2 GDP at just 0.1 percent, any slowdown in the US will remove one of the main engines of growth. Indeed, some argue that the US has avoided recession only because of the surge in AI-related spending, while private investment elsewhere in other sectors has contracted this year under the weight of generally high interest rates and tariff uncertainty. The boom in AI spending has also sparked debate over whether a bubble is forming, similar to the Dotcom bubble of 2001 – any such correction in the technology giants could have far reaching consequences across all markets as investors move into deleverage mode.

For now, the path of least resistance in the base metals seems to be sideways to higher, but there is little room for complacency given uncertainty on the economic and geopolitical fronts.