Does It All Come Down to Inflation? Manic Metals Report 11/10/2026

Traders are focused on this morning's October Consumer Price Index, due at 7:30 AM CT, as Federal Reserve officials signal a tougher stance. Fed Governor Christopher Waller, speaking in London ahead of the release, said he would still back a quarter-point rate hike in December even if October inflation improves, but would consider a half-point move if core CPI comes in around 0.3% or higher, saying "Hiking only 25 basis points would put our credibility at risk." Economists surveyed by Reuters and Dow Jones expect headline CPI to rise 0.3% and core to rise 0.2%, slower than September's 0.6% and 0.3% gains but still elevated for a Fed with rates at 3.75% to 4.00%. Because of last year's government shutdown, the Labor Department will not publish official year-over-year rates; private estimates put headline inflation at about 3.8% to 3.9% and core at 2.7%. Producer prices follow Friday, and the Fed's preferred PCE gauge is due Wednesday, November 25. As of Monday night, markets were pricing roughly an 85% chance of a December hike.

In precious metals, the article argues the sell-off does not signal a broader reversal. December gold was at $4,084.90, down $29.60 after Monday's bounce, and the World Gold Council said China added about 25.8 metric tons to its reserves in October, its largest monthly purchase in three years. December palladium rose $7.50 to $1,029.00, and January platinum was at $1,550.70. December silver was at $52.395. The article draws a seasonal parallel to 2025, when silver climbed from about $48 an ounce in early November to an all-time high of $121.62 on January 29.

Physical demand remains central to the silver outlook. The Silver Institute and Metals Focus expect a sixth straight annual deficit in 2026 of about 67 million ounces. India is the key market: Indian physical investment rose 33% in 2025 to 79.2 million ounces, and total Indian investment demand, including an estimated 68.3 million ounces into silver ETPs, reached a record 147.6 million ounces. Licensing delays cut Indian imports about 32% to roughly 87 million ounces in the first nine months of 2026, but authorities have since issued licenses for 6,500 tonnes over six months. China's physical investment more than doubled to 11.9 million ounces in 2025, and Metals Focus projects a 6% rise to 12.6 million ounces this year. China Customs data show silver ingot imports of 1,066 tonnes through September.

Copper faced a political shock after last week's midterms, when Democrats who campaigned against data centers began discussing limits on the AI buildout. Senator Bernie Sanders called for a "national data center moratorium now," and Texas Governor-elect Gina Hinojosa pledged to freeze new data center approvals until the legislature writes new rules; Wells Fargo says Texas holds 27% of planned data center capacity. AI-linked shares sold off, and copper followed. The article argues that demand fundamentals remain intact: BHP estimates data center copper use will grow six-fold by 2050 to around 3 million tonnes a year, the IEA sees a copper supply gap of about 25% in 2035, and Goldman Sachs raised its forecasts. Chicago Fed President Austan Goolsbee said the AI buildout is "starting to look more just like old-fashioned demand overheating." Near-term indicators also support prices, with the Yangshan copper import premium at a record $230 a tonne and December COMEX copper at $6.3040 a pound.