Gold and silver prices moved higher this week following softer-than-expected US inflation data, which reduced expectations for further Federal Reserve rate hikes. London gold settled at $4,390.70 per ounce, up $55.15 from August 7th, a gain of 1.27%. Silver also advanced, reaching $64.61 per ounce, up $0.29 from the previous week. The latest figures show US core CPI rose 2.5% year-on-year in July, down from 2.6% previously, while headline CPI came in at 3.4% versus 3.5% prior. Producer prices cooled more sharply than anticipated at 4.7% annually, and retail sales contracted 0.6% month-on-month, underscoring a softening economic picture. According to the CME FedWatch tool, the probability of a Fed rate hike in September 2026 has fallen to 33.1% from 44.4% a week earlier. This dovish shift, combined with continued gold purchases by the People's Bank of China, which accelerated in July, supports expectations for sustained upside in bullion prices.

Copper and Aluminum: Off-Season Demand, Yet Inventories Decline

Copper prices displayed a mixed performance this week, with LME copper closing at $14,133 per tonne, up 0.31%, while SHFE copper dipped 0.28% to 108,300 yuan per tonne. Inventory data revealed notable divergence: LME stocks fell by 18,000 tonnes to 204,975 tonnes, COMEX inventories rose by 12,631 tonnes to 735,470 tonnes, and SHFE stocks decreased by 385 tonnes to 69,731 tonnes. Domestic social inventories of refined copper stood at 116,700 tonnes as of August 15th, down 2,500 tonnes from the previous week. The spot TC for Chinese copper concentrate weakened further to -$176.42 per dry tonne, reflecting persistent tightness in mine supply. Downstream activity remained subdued, with refined copper rod operating rates at 59.3% and wire and cable utilization at 62.25%. During the traditional consumption off-season, buyers continue to procure on a need-only basis, keeping overall transaction volumes sluggish. Recycled copper faces headwinds from tight tax-inclusive supply and rising documentation costs, while the refined-secondary spread remains elevated. Copper prices are expected to fluctuate within a high range.

Aluminum prices eased slightly, with domestic electrolytic aluminum at 23,860 yuan per tonne, down 130 yuan from August 7th. Inventory levels painted a constructive picture: LME aluminum stocks fell by 8,100 tonnes to 248,300 tonnes, and SHFE inventories decreased by 13,642 tonnes to 422,097 tonnes. Social inventories of aluminum ingots dropped by 35,000 tonnes week-on-week to 898,000 tonnes as of August 15th. Production economics remained healthy, with immediate smelting profits in Yunnan at 8,347 yuan per tonne and Xinjiang at 7,271 yuan per tonne. Downstream data showed aluminum profile operating rates at leading enterprises at 50.8%, while aluminum cable utilization edged up to 62.4%. Weekly domestic output has remained broadly stable, with the molten aluminum ratio rising slightly, while overseas supply continues to expand through new project ramp-ups and restarts. With downstream processing in its seasonal lull, near-term aluminum prices are expected to trade with a weaker bias.

Tin: Balanced Weakness Keeps Prices Rangebound

Refined tin prices declined 1.59% this week to 427,770 yuan per tonne. Inventory movements were mixed, with SHFE stocks increasing by 516 tonnes to 5,962 tonnes, while LME inventories fell by 205 tonnes to 5,485 tonnes. The market remains characterized by weak supply and demand dynamics. On the supply side, hard constraints persist: production resumption at the Wa State mining region is capped at 50% of pre-ban levels with full restoration delayed until 2027, and tin concentrate processing fees remain at depressed levels, maintaining the transmission chain from tight mine supply to constrained refined output. On the demand front, buyers show limited enthusiasm for chasing prices during the off-season, with most downstream enterprises adopting a wait-and-see stance.

Lithium: Prices Rebound on Scattered Demand

Lithium carbonate prices posted a solid recovery this week, with industrial-grade material rising 6.47% to 148,000 yuan per tonne. Factory inventories increased by 1,800 tonnes to 24,753 tonnes. The short-term rebound is driven by supply-side factors, as the conclusion of maintenance at several lithium salt plants brings marginal supply increases, though spot availability remains constrained. Demand-side support stems from spot replenishment needs triggered by reduced long-term agreement volumes, providing a price floor in the current market environment.

Sector Ratings and Investment Strategy

For gold, significant central bank purchasing continues to underpin long-term prices, warranting a "Recommended" rating. Copper maintains its "Recommended" rating given persistently tight mine supply. Aluminum retains its "Recommended" rating supported by rigid domestic production capacity constraints. Tin holds a "Recommended" rating as supply disruptions intensify. Lithium also maintains a "Recommended" rating, backed by strong energy storage demand supporting long-term price levels.

Key Stock Recommendations

In the gold sector, recommended names include Zhongjin Gold, Shandong Gold, Chifeng Gold, Shanjin International, and China Gold International. For copper, the top picks are Zijin Mining, CMOC, Jincheng Mining, Western Mining, Zangge Mining, and MMG. Aluminum recommendations feature Shenhuo Co, Yunnan Aluminium, Tianshan Aluminum, and China Hongqiao. In the tin sector, Tin Industry Co and Xingye Silver Tin are favored. For lithium, Sinomine Resource, Shengxin Lithium Energy, Guocheng Mining, and Ganfeng Lithium are highlighted.

Market Performance Review

During the week of August 10-14, 2026, the non-ferrous metals sector declined 1.26%, ranking among the weaker performers across all major Shenwan industry classifications. Within the sector's third-level sub-industries, performance was mixed, with lithium leading gains at +2.97%, followed by nickel at +2.79% and rare earths at +0.58%. The top gainers for the week included Longci Magnetics (+12.76%), Western Materials (+11.14%), Haomei New Materials (+10.79%), Boke New Materials (+10.13%), Yongshan Lithium (+7.94%), Hesheng Co (+7.82%), Ningbo Fubang (+7.77%), China Rare Earth (+6.57%), Shengxin Lithium Energy (+5.74%), and Rongjie Co (+5.55%). On the downside, the weakest performers were Huitong New Materials (-7.00%), Northern Copper (-7.17%), Xinweiling (-7.24%), Zijin Mining (-7.45%), Hailiang Co (-8.27%), Tianli Composite (-8.78%), Zuxing New Materials (-9.50%), Jiangxi Copper (-10.02%), CMOC (-11.47%), and Western Mining (-13.77%).

Key Risk Factors

Investors should monitor several potential risks: a resurgence in US inflation; Fed rate cuts falling short of expectations; weaker-than-expected recovery in domestic copper demand; unexpected electrolytic aluminum capacity shutdowns affecting listed company output; aluminum demand shortfalls; tin demand disappointments; faster-than-anticipated tin mine commissioning; lithium mine production exceeding forecasts; and lower-than-expected lithium battery demand.