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METI predicts a 1.7% drop in crude steel production for Japan between January and March.
The Ministry of Economy, Trade and Industry said that the?weak?demand in the construction and manufacturing sector will cause Japan's crude steel production to?fall 1.7% during the first three months of 2026. Forecasts show that the third largest steel producer in the world will have a 'annual output' of 80.33 millions metric tons for the fiscal year which ends March 31, down 3.2% compared to a year earlier. This is the lowest production since fiscal 1968 when crude?output rose during Japan's high growth era. Manabu Naboshima, Director of METI's Metal Industries Division, said at a "news conference" that Japan's 'crude steel' production peaked at 121.51 millions tons in fiscal 2007. Since then, it has fallen to two-thirds. He said: "We do not make any production predictions for the next fiscal year. However, output in the January-March period is likely to be largely unchanged from current levels. The ministry, citing a survey of the industry, said that demand for steel products, including those intended for export, will fall by 1.6% in January-March to 18.27 millions tons compared to a year ago. The ministry has forecast a 0.5% drop in exports. (Reporting and editing by Tomaszjanowski)
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Silver reaches new highs on demand for safe havens; gold reaches record levels
As 'investors' flocked to the safety of gold amid the U.S./Venezuela conflict, silver rallied to a new high. Gold spot rose by 0.9%, to $4,486.55 an ounce, at 0753 GMT. It had earlier reached a session record of $4,497.55. U.S. Gold Futures for February Delivery gained 1.1%, reaching $4,519.20. Tim Waterer is the chief market analyst for KCM Trade. He said that U.S.-Venezuela tense relations are keeping gold in investors' minds as a hedge against uncertainty. Gold has surged this past week, as part of a larger positioning shift, with U.S. rates expected to ease even further. Waterer stated that buyers continue to view precious metals as an effective means to diversify their portfolios and maintain value. He added, "I do not think we have reached the high watermark for?gold or?silver." Last week, U.S. president Donald Trump announced a "blockade", which would prevent all oil tankers subject to sanctions from entering or leaving Venezuela. Markets are pricing in two rate reductions for next year, amid expectations of a more dovish stance. Bullion has risen more than 70% this year. This is due to a powerful mix of geopolitical risk, central bank purchases, de-dollarisation and renewed exchange traded fund inflows. As the year ends, the thinner liquidity could intensify price swings, said Frank Walbaum. A market analyst for trading and investment platform Naga, Walbaum noted that gold may remain particularly sensitive to geopolitical headlines as well as changes in rate expectations. Silver spot?advanced by 0.8%, to $69.56 an ounce, after reaching a record high at $69.98. Its year-to date gains have exceeded 141%, outpacing the gold market on account of supply deficits and?industrial demand. Michael Brown, senior strategist at Pepperstone, stated that some consolidation could be possible during the holiday period, as liquidity?thinned. He said, however, that the rally would resume once the volumes return. The $5,000 level is a natural goal for gold in the coming year, and $75 for silver on a long-term basis. The spot platinum price rose 3.1%, to $2,185.05. This is the highest level in over 17 years. Palladium also rose 2.7%, to $1,806.25, a new three-year high, tracking gold and silver. (Reporting from Sherin Elizabeth Varighese in Bengaluru and Arunima Kumar; editing by Rashmi Aich, Subhranshu S.)
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Copper nears record highs due to supply constraints and rate cuts
Prices of copper were largely stable on Tuesday. They remained near the record highs set in the previous session as supply constraints, and bets that the U.S. monetary policy would ease, and China's, boosted?prices. As of 0727 GMT, the most active contract for copper on Shanghai Futures Exchange had closed daytime trading little changed, at 93 740 yuan per metric ton ($13 337.0). On Monday, it reached a new record high of 95,470 yuan. The benchmark copper three-month contract on the London Futures Exchange? grew by 0.2%, to $11,944.0 per ton. Markets are pricing in two rate reductions for next year, amid expectations of a more dovish stance. Supply-side factors were also supportive in China. According to a Chinese market data provider, the country's top copper smelters plan to reduce production by more than 10% in 2026 in order to "counter" overcapacity that has led to an increase in copper concentrate processing costs. Kunal Shah is the head of Nirmal Bang Commodities' research. He said, "The fundamentals of base metals are very positive (as China is likely to introduce another round of interest rates cuts) and also is looking to reduce excess melting capacity for base materials. This is very, extremely bullish." Nickel, among other SHFE base materials, rose 4.4%, to 123.040 yuan per ton. This is a higher price than two months. The London nickel benchmark also rose, rising 1.2% to $16,460 per ton. This is its highest level since October 10. Shah said that "LME copper is expected to reach $13,500/ton in the coming months, while aluminium will likely (reach $3200/t) within the next six-to-nine months. Zinc could also test $3200/t after the next quarter." Aluminium fell by 0.3% in Shanghai. Zinc rose by 0.1%. Lead increased 0.3%. Tin gained 0.5%. Aluminium, zinc, and lead all rose 0.3%. Tin gained 1.2%.
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As mill maintenance and rising China port stock weigh, iron ore falls
The lowering of iron ore futures on Tuesday was a result of steel mills performing annual furnace maintenance, and rising Chinese port inventories. The May contract for iron ore on China's Dalian Commodity Exchange traded 0.26% less at 778.5 Yuan ($110.77). As of 0700 GMT, the benchmark January iron ore was trading 0.39% lower on Singapore Exchange at $104.35 per ton. The benchmark is unlikely to 'break $100,' a Singaporean trader told us under condition of anonymity. This is due to the fact that there has been no winter stocking, which indicates a weak demand. The trader said that most participants would be reluctant to speculate or push prices up. "Pricing is still stable and strong in spite of the general strength in commodities." Steel mills are currently in the middle of their annual blast furnace maintenance plans. This is causing a larger decline in pig-iron production. Everbright Futures, a Chinese broker, says that port inventories are continuing to increase, which indicates a slight weakening in fundamentals. SteelHome data shows that the total iron ore stocks in China increased 1.19% from a week ago to?145.5 millions tons as of December 19. The dollar index, which compares the currency to six other units, fell to 98.061 at the start of trading on Tuesday. It is still on course for a 9.5% decline for the year. This will be its biggest annual drop since 2017. The weaker dollar makes dollar-denominated investments more affordable for holders of other currencies. Coking coal and?coke were both up 1.9% and 0.26% respectively. The Shanghai Futures Exchange steel benchmarks were mostly in the green. The benchmarks for steel on the Shanghai Futures Exchange were mostly up.
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Two dead in underground explosion in Polish coal mine
JSW, the owner of Pniowek Coal Mine in southern Poland, announced on Monday that two workers had been killed by an explosion of'methane and rocks masses' at the mine. A large amount of methane has been released from the Pniowek Mine, which was operating with 10 underground workers and a high-performance?roadheader. JSW said that eight people were able to escape on their own while two others lost contact. The company reported that after a seven-hour search, teams located the missing miners, who were declared dead by a doctor on the spot. The Polish Prime Minister Donald Tusk expressed his condolences on Tuesday morning to the families of those who died in the mines. Karol Nawrocki, President of Poland, said he was "deeply saddened" by this news. The Polish Press Agency (PAP), reported that these deaths are the 14th, 15th and 11th fatalities in mining accidents this year in Poland and the 12th and 13th in hard coal mines. PAP reports that the Pniowek coal mine has the highest risk of methane in the country. Reporting by Barbara Erling, Editing by Jamie Freed
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Silver reaches new highs on demand for safe havens; gold reaches record levels
Investors flocked to gold as a safe haven amid U.S. - Venezuela tensions. Silver also reached a new high. As of 0637 GMT spot gold was up 0.7% at $4,476.15 an ounce after reaching a session record of $4,497.55 in the earlier part. U.S. Gold Futures for February Delivery rose by 0.9% to $4,509.80. Tim Waterer is the chief market analyst for KCM Trade. He said that U.S.-Venezuelan tense relations are keeping gold in investors' minds as an 'uncertainty hedge.' Gold has surged this past week, he added, as a?particular positioning shift, with U.S. rates expected to ease further. Waterer stated that buyers continue to view precious metals as a way to diversify their portfolios and preserve values, adding "I do not think we have reached the high watermark for gold or silver yet." Last week, U.S. president Donald Trump announced that all oil tankers entering or leaving Venezuela would be "blocked" by?sanctions. Markets priced in two rate reductions for next year, amid expectations of a more moderate policy stance. Bullion has risen more than 70% this year. This is due to a powerful mix of geopolitical risk, central bank purchases, de-dollarisation and renewed exchange traded fund inflows. As the year ends, lower liquidity levels could increase price swings, said Frank Walbaum. A market analyst for trading and investment platform Naga. He noted that gold may remain particularly sensitive to geopolitical headlines, and changes in rate expectations. Spot'silver' rose 0.6% per ounce to $69.44 after reaching a record high at $69.98. Its year-to date gains have exceeded 141%, outpacing the gold market on account of supply deficits and?industrial demand. Michael Brown, senior strategist at Pepperstone, stated that some consolidation could be possible during the holiday period as liquidity thinned. He said, however, that the rally would resume once the volumes return. The $5,000 level is a natural goal for gold in the coming year, and $75 for silver on a long-term basis. The spot platinum price rose by 2.2%, to $2,167.25. This is the highest level in over 17 years. Palladium also rose by 2.5%, to $1,803.91, a new three-year record, tracking gold and silver. (Reporting from Sherin Elizabeth Varighese in Bengaluru and Arunima Kumar; editing by Rashmi Aich, Subhranshu Shu.)
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China's association of tin producers says the price hike is "unreasonable".
An industry association backed by the Chinese government said that on Tuesday, the tin sector had been hit by the "unreasonable",?price rise and urged investors to avoid excessive?speculative trade. Tin prices are at their highest "levels" in 44 months, following a wave supply disruptions. The material is used to solder circuit boards for mobile phones and electric cars. The China Nonferrous Metals Association's tin branch posted a statement to its WeChat page saying that the rapid price rise was driven by money, which has distorted industry fundamentals and increased market risks. The report called for all participants in the market to "avoid following trends blindly" and "resist speculative activity that violates objective laws of the markets". On December 22, the?most active tin contract at the Shanghai Futures Exchange reached 347,500?yuan ($49.438.75 per metric ton), its highest price since April 7, 2020. On December 19, the benchmark price for three-month tin on the London Metal Exchange reached its highest level since April 19th, 2022. It was $43,935 per ton. Shanghai and London prices are up 12% and 10% respectively so far this month. It said that the supply from major producers such as Myanmar and the Democratic Republic of Congo has improved. Tin ores from Myanmar's Wa state have increased to almost 1,000 tons. It said that China's refined-tin production in the first 11 months of the year rose by 6.2% compared to the previous period. Global tin demand is expected grow by 3%. This leaves a surplus of 10,000 tons. The association stated that "the sharp price increase has increased cost pressure for downstream consumers and eroded their profits, making it difficult to meet long-term agreements." Reporting by Amy Lv, Ryan Woo and Neil Fullick. Editing by Neil Fullick.
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Stocks and precious metals are rising; the yen is on watch
Asia shares and precious metals rose on Tuesday, as investors continued to buy ahead of the "festive holidays", with a reading on the U.S. Gross Domestic Product (GDP) expected later that day. The fragile yen recovered as traders watched for any signs that Japanese authorities would intervene to stop the currency's decline. Investors can catch up with a number of U.S. Economic releases that were delayed due to a record-breaking government shutdown in January. The key data for Tuesday will be the third-quarter figures of growth, which are expected to show that the U.S. has continued to grow strongly. The expected annualised growth is 3.3%. This is a slight drop from the previous quarter, due to a sharp decline in imports following a surge earlier in the year before the introduction of tariffs. David Doyle, Macquarie Group's head of economics, said that the underlying growth is likely to slow in Q4 due to the prolonged government shutdown. He also noted the possibility of a new headwind coming from auto sales. The market sentiment remained positive ahead of the result. MSCI's broadest Asia-Pacific index outside Japan rose by 0.39%. Tokyo's Nikkei fell 0.1% due to a stronger yen. European futures are mixed, but Nasdaq and S&P 500 futures are little changed. Shares of Nvidia soared overnight after a report that the company had told Chinese clients they planned to begin shipping their second-most powerful AI chip to China in mid-February, before the Lunar New Year holidays. Novo Nordisk shares listed in the United States jumped 6% during extended trading on Monday after the U.S. Food and Drug Administration (FDA) approved its weight loss pill. Jose Torres is a senior economist with Interactive Brokers. He said, "Risk-on sentiment?is dominating Wall Street as we begin the week before Christmas, and investors are increasing equity and commodity exposures in preparation for year-end." For now, traders will take their cues from the general feeling among participants that little is standing in the path of a Santa Claus rally manifesting. Spot gold and silver reached all-time-highs in precious metals. This was driven by the demand for safe-haven assets as geopolitical tensions escalated, with the U.S. attempting to seize more tankers transporting Venezuelan oil. After rising on Monday due to concerns about disruptions in supply, oil prices have eased slightly. Brent crude futures dipped 0.26% to $61.91 per barrel, while U.S. oil fell 0.33% at $57.82 a barrel. INTERVENTION RISK KEEPS YEN IN CHECK Hong Kong's Hang Seng Index remained flat, while China's CSI300 blue chip index rose 0.4%. According to the summary of Tuesday's housing policy conference, China will intensify urban renewal in 2026 and make greater efforts to stabilize its property market as it prepares for its next Five-Year Plan (2016-2030). The yen was the main focus on the foreign exchange markets as investors assessed the likelihood of an impending intervention by the Japanese authorities to support the currency. Satsuki Katayama, the Finance Minister of Japan, said that Tokyo has the right to intervene on the currency market if the yen's value continues to fall. This is the strongest warning yet about Tokyo's willingness to do so. The yen rose 0.7% to 155.99 against the dollar. It also made large gains against peers such as the euro and Swiss franc. Vishnu Varathan is the head of Asia ex-Japan macro research at Mizuho. He says that intervention "may be more opportunistic than imminent." He said, "And be sure there won't be any fixed 'line' in the sand." The BOJ increased rates on Friday at the end of its policy meeting for December. This was widely anticipated and Governor Kazuo ueda gave few hints about the future extent of rate increases. "Their message was so unimpressive... You hike, but it needs to be with conviction. "They didn't walk with conviction", said Alicia Garcia Herrero chief economist of Asia Pacific for Natixis. The dollar has been on the back foot in other currencies. The euro rose by 0.15% to $1.1776 while the pound sterling increased by 0.24% at $1.3493.
Mike Dolan: Guns and gold will win in 2025 but other "safety" trades will bomb.
In 2025, precious metals outperformed all other "safe haven" investment options. This is remarkable, especially in an year that was marked by turmoil, conflict and artificial intelligence bubble concerns. The market landscape for this year was shaped by a number of factors: a booming economy, politicians pushing for easy money, fading recession fears, an AI frenzy, and rising geopolitical tensions. Precious Metals outperformed almost everything else. Silver and platinum have more than doubled and gold has risen over 60%. This is its biggest jump since 1979's oil crisis. This performance was far superior to the roughly 20% gain in global equity indices. It is not yet clear whether gold, silver and platinum are caught in their own speculative bubble. Their strength is boosted by central bank demand, and their role in the wider tech build-out. The oil glut has sunk the wider commodity indexes this year. The price of crude oil has fallen by 20% in one year despite several tensions in the Middle East and fears that it will reach $100 per barrel. The best investment for those worried about a global conflict was the defense sector. U.S. aerospace stocks and defense stocks saw gains of 36% by 2025 while European counterparts rose 55%, and Germany and Europe re-armed.
LAGGING BONDS & DEFENSIVES This year, most traditional buffers and defensives played a role as dead weights in portfolios rather than a protection. Even bitcoin, which is referred to by some as "digital currency", ended the year with a loss. Bonds also had a bad year. Global "risk-free' government bond indices lost about 1% on a dollar basis, but returned just over 6% in total. Bloomberg Multiverse benchmarks, which include government, supranational, agency, and corporate debts, performed little better with price gains around 1% and total returns near 7%.
This is less than half of the increase in MSCI's index of all-country stocks, which has been on course for its best year ever since before the pandemic.
Going defensive in equities was not a winning strategy. The S&P 500 as a whole, boosted by the tech megacaps and AI theme, posted annual gains of 15 %, as the strong U.S. economy rebounded and interest rates fell in the second half 2025. S&P 500 stocks that are considered "growth" soared 20%. This is more than twice the gain of stocks classified as "value". The S&P 500 total return was 5 percentage points higher than the equally-weighted index. Utility, healthcare, and financial stocks all had good years with gains of more than 10%, but they still trailed behind the main index. Consumer staples, which are at the bottom of the list, only managed to gain 2%. The Dow Industrials blue chip index also lagged behind the S&P 500 as well as the Nasdaq.
SAFETY IS LAST The yen of Japan and the franc of Switzerland are often viewed as safe currencies. However, one of these also disappointed at year's end.
The yen initially rose in value, as did the Swiss franc. However, the Japanese currency lost all of its gains after the dollar fell. Investors were worried about new fiscal stimulus, and the arrival of Sanae Takaichi as Prime Minister caused some unrest on domestic bond markets.
The yen has fallen by about 4% in real terms against Japan's major trading partners.
The franc held onto its gains in the early years and was, along with silver and gold, one of few safe havens that made good by 2025.
If you thought the dollar was a safe haven during times of geopolitical tension, you were wrong. The 'DXY' dollar index dropped 12% in some of the most turbulent months and continued to be weak throughout multiple flashpoints across the Middle East, Eastern Europe, and even the Caribbean. Investors who are wary of disruptions could have bought volatility indexes that track options to benefit from the wild swings in stock and bond prices.
These parachutes didn't open in 2025 either. The S&P 500 VIX "fear" index of implied volatility for one month ended the year at a two-point deficit from where it began, despite big swings during the spring. MOVE, the Treasury equivalent index, has fallen by more than two thirds from its opening level, and is now less than half of its peak in April. Also, the main currency market vol' gauges have fallen. This year, it didn't pay to be overly cautious.
Double or quit in 2026?
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(source: Reuters)