Global Economic Outlook - Global economic growth is expected to slow to 2.3% in 2025, the lowest rate since 2008, excluding global recession years [1][55] - Growth in advanced economies is projected to decline to 1.2%, with significant impacts from trade policies in the US and Eurozone [2][55] - Emerging market and developing economies (EMDEs) are forecasted to grow at 3.8%, with China at 4.5% and India at 6.3%, although many countries are underperforming relative to expectations [2][55] Trade and Inflation - Global trade growth is anticipated to drop to 1.8% in 2025, with commodity prices expected to decline by 10% [2][67] - Global inflation is projected at 2.9% in 2025, with core inflation remaining high due to persistent service price pressures [2][68] Regional Economic Prospects - East Asia and Pacific growth is expected to slow to 4.5%, with risks from trade tensions and geopolitical conflicts [4][56] - Europe and Central Asia are projected to grow at 2.4%, affected by tightening monetary policies and ongoing geopolitical risks [4][56] - Latin America and the Caribbean are forecasted to have the lowest growth among EMDE regions at 2.3%, hindered by high trade barriers [5][56] - The Middle East and North Africa are expected to grow at 2.7%, with oil-exporting countries mitigating price drops through increased production [6][56] - South Asia is projected to grow at 5.8%, driven by India, while facing challenges from political and economic issues in neighboring countries [6][56] - Sub-Saharan Africa is expected to grow at 3.7%, with Nigeria and South Africa showing weak growth due to reliance on commodity exports [7][56] Risks and Policy Recommendations - Major risks include escalating trade barriers, tightening global financial conditions, geopolitical conflicts, and extreme weather events [8][54] - Policy recommendations emphasize global cooperation to rebuild trade relations, restore fiscal order, and accelerate job creation [9][10][11]

Investment Rating - The report provides a "Buy" rating for several companies in the basic materials sector, including Angang-H, Baosteel, Conch-A, and Zijin-A, indicating a positive outlook for these stocks with potential upside ranging from 22% to 51% [10]. Core Insights - The feedback from producers as of mid-May suggests that end-user order books were flat month-over-month (MoM), which is softer than past seasonal trends. Infrastructure recovery has paused, reflected in weak cement shipments and a lack of funding for new projects [1][2]. - Current Chinese demand for cement and construction steel is reported to be 12-14% lower year-over-year (YoY), while demand for copper has increased by 9% YoY. The demand for flat steel and aluminum is 1-3% lower YoY [1]. - The report highlights that while the supply chain is partially replacing US-bound shipments with production from other countries, the reduction in Chinese metal demand is less severe than initially feared [1]. Summary by Sections Downstream Demand Snapshots - The downstream order book trend was mostly stable MoM in May, with 25% of respondents indicating a pickup in the downstream sectors and 31% indicating a lower trend [2][3]. Steel Production - Steel production cuts are in preparation, and rush orders for exports are re-emerging. The report suggests that steel-making raw materials could potentially drop to sub US$80-90 per ton if production cuts are implemented [9]. Cement Market - The cement market has experienced a sudden deterioration, with current demand showing significant declines [9]. Aluminium and Copper - The report notes a disruption in Guinea bauxite supply affecting alumina, while copper demand remains more resilient than expected [9]. Coal Market - The coal market is characterized by very weak demand and pricing, indicating challenges for companies in this sector [9]. Lithium Market - The lithium market is facing a rising surplus, which may impact pricing and demand dynamics [9]. Paper Packaging - Improving shipment trends are noted in the paper packaging sector, driven by upcoming online shopping festivals and lower US-China tariffs [9].

Investment Rating - The report provides a mixed investment rating for various companies in the basic materials sector, with specific recommendations such as "Buy" for companies like Angang-H and Conch-H, while others like Maanshan-A and Chinacoal-H are rated as "Sell" [10]. Core Insights - The overall sentiment in the basic materials sector is that current demand is less concerning than previously anticipated, with a notable deceleration in local government special refinancing bond issuance impacting infrastructure recovery [1]. - Current Chinese demand for cement and construction steel is reported to be 12-14% lower year-on-year, while copper demand has increased by 9% [1]. - The downstream order book trend has remained mostly stable month-on-month, with 31% of respondents indicating a lower trend in May for basic materials [2][3]. Summary by Sections Downstream Demand Snapshots - Infrastructure recovery has paused due to a lack of funding for new projects, leading to weak cement shipments [1]. - The demand for construction materials is showing signs of weakness, particularly in cement and construction steel, while copper demand remains resilient [1]. Steel Production - Steel production cuts are in preparation, with a potential reduction in prices if these cuts are implemented [1]. - The report notes that rush orders following the reduction of US-China tariffs were limited, primarily driven by Southeast Asia [1]. Commodity Prices - The pricing for steel and cement has remained stable, while prices for aluminum and copper have improved, contrasting with the softening of coal and lithium prices [1]. Specific Company Insights - Angang-H is rated as "Buy" with a target price of CNY 2.40, indicating a potential upside of 45% [10]. - Conch-H is also rated as "Buy" with a target price of CNY 29.00, reflecting a 37% upside potential [10]. - Companies like Maanshan-A and Chinacoal-H are facing downward pressure, rated as "Sell" with target prices significantly lower than current prices [10].

Summary of Global Commodities Research Industry Overview - The report focuses on the global commodities market, particularly oil and base metals, highlighting recent trends and forecasts for 2025. Key Points Oil Market Insights - Global oil demand improved in early May, averaging 103.6 million barrels per day (mbd), which is a year-over-year increase of 440 thousand barrels per day (kbd) but still 240 kbd below expectations [6] - Global liquid stocks increased by 38 million barrels (mb) in the second week of May, driven by a 44 mb build in crude oil stocks [6] - Despite a 22% decline in crude prices since mid-January, refined product prices and refining margins have remained steady, with US gasoline cracks surging [5] - Structural downsizing of refining capacity in the US and Europe is expected to lead to a gasoline deficit, pulling supply from other regions [5] - Resilience in crude and refined product prices is anticipated to persist through the second quarter of 2025 before deteriorating in the latter half of the year [5] Base Metals Outlook - A better-than-expected US-China trade reprieve has reduced recession probabilities, diminishing downside risks to base metals demand and prices [8] - Near-term base metals price forecasts have been revised higher due to macroeconomic shifts [8] - Concerns remain about the longevity of demand pull-forward from China, with a potential bearish reckoning expected in the second half of 2025 [10] Market Positioning and Flows - The estimated value of global commodity market open interest recovered by 4% week-over-week to $1.43 trillion, with significant inflows into metals and agricultural markets [9] - Contract-based inflows increased to a seven-week high of $27 billion, with nearly $15 billion flowing into metals markets [9] Tariff Implications - The US-China trade agreement includes a 90-day reprieve of tariffs, which is expected to boost China's GDP by approximately 1.5%, raising full-year growth to 4.8% [12] - The average tariff rate on China is projected to be 41%, while China's average tariff rate on the US is 28% [12] Future Projections - The report anticipates a tightening of supply in base metals, which could support prices later in 2025 [28] - The agricultural markets are expected to remain fundamentally driven in the short term, with potential macro-driven inflows contingent on trade developments [10] Additional Insights - The rig count in major tight oil basins decreased by three, with the Permian losing three rigs, although production impacts are expected to be delayed due to operational efficiencies [10] - The report highlights the importance of monitoring macroeconomic indicators and trade relations as they significantly influence commodity prices and market dynamics [10][19] Conclusion - The global commodities market is experiencing a complex interplay of demand recovery, structural changes in refining capacity, and macroeconomic factors, particularly influenced by US-China trade relations. The outlook for both oil and base metals remains cautiously optimistic, with potential volatility expected in the latter half of 2025.

Core Viewpoint - The article discusses the recent trends in gold prices, highlighting the potential for gold to reach $3,200, influenced by various factors including U.S.-China relations, interest rate movements, and the economic environment in the U.S. [4][28] Summary by Sections CFTC Data and Market Sentiment - The article emphasizes the importance of the CFTC data released weekly, which reflects market sentiment towards precious metals and short/medium-term price judgments [3][4]. Gold Price Trends - As of March 31, international gold prices reached a new high of $3,100, with a potential to stabilize around $3,200 before further movements depending on market focus [4][28]. - The article notes that gold prices have risen significantly since last November, when they dropped to around $2,590 [4][28]. Fund Positioning - As of March 25, net long positions in COMEX gold decreased by 3.7% to 599 tons, marking the 76th consecutive week of net long positions [5][9]. - The article indicates that the net long positions in silver also fell, while platinum saw a significant increase in short positions [5][9]. Market Dynamics - The article highlights that despite rising gold prices, there is currently a lack of excessive greed in the market, which could indicate further upward potential [4][27]. - It also mentions that the performance of gold and other risk assets may be affected by fluctuations in the U.S. stock market [4][28]. Economic Indicators - The article discusses the probability of the U.S. Federal Reserve cutting interest rates in June, which could further influence gold prices [26][28]. - It suggests that the market is currently pricing in multiple rate cuts, which could lead to increased volatility in the dollar and subsequently benefit gold prices [26][28]. Future Outlook - The article predicts that geopolitical risks and economic conditions will play a crucial role in shaping the future of gold prices, with a particular focus on the potential for a significant downturn in copper prices due to changing demand dynamics [19][29]. - It concludes that the next 12 to 24 months will be critical for the U.S. economy, especially if inflation pressures resurface alongside interest rate cuts [32][28].