Deutsche Bank’s Daniel Ghali eyes copper as metals market shifts

Despite rising U.S. 10-year Treasury yields exceeding 5% and crude oil prices topping $100 a barrel, gold has maintained its value remarkably well since July. Ghali suggests that current market positioning in gold is the most bearish seen since October 2021, yet the fundamental landscape has shifted. Official sector purchases have doubled compared to that period, and the pool of institutional investors participating in the gold market has expanded by roughly 70%. Rather than viewing bonds and gold as a binary choice, Ghali argues that the current Treasury bear market is actively encouraging institutional investors to seek diversification through gold.

Conversely, the outlook for silver has dimmed. Physical inventory levels in London have reached their highest point since November 2024, and stockpiles on the Comex and in Shanghai have grown. Beyond the supply glut, high prices have triggered a decline in industrial demand, particularly within China’s solar sector, which Ghali estimates has fallen by one-third in 2026. This combination of increased availability and weakening demand suggests a period of underperformance and lower volatility for silver compared to gold.

Copper presents a different trajectory. Ghali identifies an acutely scarce environment, noting that the United States and China have effectively locked up approximately 70% of global aboveground inventories. This concentration of supply creates the potential for a convex price reaction, positioning copper as the most compelling opportunity for investors seeking significant gains in the near to medium term.