Commodity Calls: Week Ending 7 February 2025

Gold rises to new all-time highs amid trade war tensions, India approves funding to develop critical metals sector, and crude oil dips on concerns over slower growth.

Join Global X each week for ‘Commodity Calls’ to explore all the recent signals and developments that occurred in the world of commodities.

Looking for more ETF Express? Check out this week’s Market Moves and Thematic Spotlight.

Gold

Bullish

  • Gold rose to new all-time highs again as investors sought safe haven assets amid trade war concerns.1 Trump’s tariffs has raised concerns over the possibility of tit-for-tat trade wars, as well as slower global growth.
  • Australian physical gold ETFs saw their strongest start to a year ever, in terms of inflows.2 Australian gold ETFs gathered more than $60 million in inflows in January, which is the most on record.

Bearish

  • The USD rallied on news that the US would be announcing reciprocal tariffs.3 Low unemployment figures also reinforced the case for the Federal Reserve to hold interest rates steady in the meantime. Markets expect just one rate cut in the US for 2025.

Explore physical gold with GOLD.

Transition Metals

Bullish

  • India has approved US$1.88 billion in funding to develop its critical minerals sector.4 India’s federal Ministry of Mines says the mission will “intensify the exploration of critical minerals within the country and in its offshore areas”. In 2023, India identified 30 minerals, including lithium, as critical minerals for the country’s energy transition.
  • India is also looking to invest in Argentina’s mining sector with a focus on critical minerals such as lithium.5 India state firms, KABIL and Coal India, are exploring lithium in Argentina’s northwest province of Catamarca.

Bearish

  • China’s largest battery manufacturer, Contemporary Amperex Technology Co (CATL), is set to restart its lithium mining operations.6 CATL’s Jiangxi lithium operation is one of the largest in the world, and there are fears that its restart could flood the lithium market with supply at a time when prices were just starting to recover.

Explore transition metals with GMTL.

Crude Oil

Bullish

  • Canadians strongly support putting export taxes on oil shipments to the US as a retaliation against Trump’s tariffs.7 In a poll by Bloomberg News, 82% of respondents supported unilaterally raising the price of US exports to combat Trump’s trade tactics.

Bearish

  • Crude oil prices have fallen on fears of weaker demand due to rising trade tensions.8 Trump’s newly announced tariffs on Chinese imports to the US are raising concerns around the possibility of an extensive trade war.

Explore crude oil with BCOM.

 

Forecasts are not guaranteed and undue reliance should not be placed on them. This information is based on views held by Global X as at 11/02/2025. Investing involves risk, including the possible loss of principal. Diversification does not ensure a profit nor guarantee against a loss.

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This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information is not intended to be individual or personalised investment or tax advice and should not be used for trading purposes. Please consult a financial advisor or tax professional for more information regarding your investment and/or tax situation.