Tag: Inflation

We have seen aluminum correlate quite well with oil prices since the Iran war started. But there has been a noticeable disconnect between the two over the past few weeks.

With a tenuous memorandum of understanding signed between the US and Iran, crude oil prices continued to sell off this past week, although the declines were not as steep as what we saw in the week prior.

There was a lot going on this past week on both the geopolitical and economic fronts. Investors were fixated on the two-day visit to China by President Trump. He arrived in Beijing last Wednesday night, with a massive corporate delegation in tow. Expectations were high that some progress would be made on a host of thorny issues. But at the end of the day, the trip produced relatively modest results.

Things took an ominous turn after President Trump announced he would order the US Navy to block any vessels entering or exiting the Gulf. We suspect we will see another sizable bounce in crude and a resumed slide in both precious metals and base metals as the two parties now potentially resort to replacing talks with missiles.

Aluminum was very in the spotlight this past week on growing concern about damage inflicted on some of the Persian Gulf's key smelters.

Markets remained frazzled last week as the conflict in the Persian Gulf entered its fourth week – with no end in sight.

Last week was one for the history books, particularly for those involved in trading precious metals in any way, shape, or form. After weeks and months of relentless price increases, the complex staged one of its most dramatic one day sell-offs on record.

Base metals ended mostly lower last week as many complexes were quite overbought and arguably due for a correction.

Section 232's recurring inclusions, layered alongside overlapping and contested tariff regimes, have turned aluminum trade policy into a rolling mechanism that boosts GDP on paper, stokes inflation in practice, and leaves buyers navigating uncertainty as the only constant.

July's producer price index (PPI) and manufacturing survey (M3) data show an aluminum sector that looks steady on paper but is shrinking once inflation is stripped away, with costs cascading unevenly through the supply chain.