As of the close on August 28, 2026, this report examines the interaction among interest-rate expectations, the U.S. dollar, inventory data, fund flows, and speculative positioning across gold, silver, crude oil, copper, and aluminum.
Market Overview
U.S. July PCE inflation rose 3.7% year over year, while core PCE inflation increased 3.3%; both remained above the Federal Reserve’s 2% target. At the Jackson Hole meeting, Federal Reserve Chair Kevin Warsh stated explicitly that “if inflation does not decline meaningfully, further rate hikes may be necessary,” significantly increasing market expectations for a September rate hike.
Against this backdrop, the commodity market featured precious metals consolidating at elevated levels before pulling back, crude oil retreating as its geopolitical premium eased, and divergent inventory trends across copper and aluminum. The asset performance shown in Figure 1 should therefore be understood through the combined framework of interest-rate expectations, the U.S. dollar, and inventories, rather than being attributed solely to changes in risk appetite.
$黄金主连 2612(GCmain)$ $微黄金2612(MGC2612)$ $1盎司黄金2612(1OZ2612)$ $白银主连 2612(SImain)$ $微白银主连 2612(SILmain)$ $100盎司白银主连 2612(SICmain)$ $WTI原油主连 2610(CLmain)$ $微型WTI原油主连 2610(MCLmain)$ $布油现金主连 2612(BZmain)$ $小原油主连 2610(QMmain)$ $COMEX铜主连 2612(HGmain)$ $铝主连 2611(ALImain)$
As of the close on August 28, 2026, weekly performance across key assets was as follows:
[Figure 1: Weekly Performance of Key Assets (red: gains; green: losses)]
Global assets displayed a divergence between strong equities and weak commodities. Hawkish Federal Reserve commentary, higher U.S. Treasury yields, and a stronger dollar pushed crude oil, gold, and silver down by approximately 5.0%, 2.9%, and 4.5%, respectively. Crude oil recorded the largest decline, reflecting a repricing of the global demand outlook and the geopolitical supply-risk premium.
Industrial metals also diverged. Copper edged up by approximately 0.4%, supported by relatively tight supply, while aluminum declined by around 0.5% under pressure from seasonal demand weakness and a stronger dollar. U.S. equities remained resilient: the Nasdaq, Dow Jones Industrial Average, and S&P 500 rose approximately 0.85%, 0.53%, and 0.49%, respectively, mainly supported by technology-sector earnings and expectations for AI-related capital expenditure.
Overall, markets continued to balance resilient growth against sticky inflation and higher interest rates. In the near term, asset pricing is likely to remain highly sensitive to movements in the U.S. dollar and Treasury yields.
Fund Flows: Equities and Bonds Continue to Rebalance
According to the latest data from the Investment Company Institute (ICI), fund flows continue to reflect a reallocation between risk assets and fixed-income assets. Founded in 1940, the ICI is one of the core associations representing the U.S. fund industry. Its statistical coverage includes approximately 98% of the assets of U.S. registered funds under the Investment Company Act of 1940. Its fund-flow data are widely regarded as an authoritative source for tracking subscriptions and redemptions in U.S. mutual funds.
The ICI has long published statistics on the assets and flows of regulated funds in the United States and globally. Its consistent methodology and broad coverage have led to extensive use by securities firms, research institutions, and financial media.
Following hotter-than-expected PCE data and Warsh’s hawkish remarks, the market’s repricing of the interest-rate path is likely to pass first through Treasury yields and the U.S. dollar, and then affect the relative attractiveness of equity and bond funds.
The data suggest that the week was more likely characterized by a “fund-flow rebalancing” than a broad-based recovery in risk appetite:
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Continued net inflows into equity funds would indicate that some investors were using the pullback to add to risk assets.
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Simultaneous inflows into bond funds would suggest that investors remained concerned about higher interest rates and growth uncertainty.
This pattern of simultaneous equity and bond inflows, or rotation between equities and bonds, means that commodities are unlikely to receive a unified macro-driven fund-flow impulse. Trading is more likely to remain differentiated by individual contracts and investment logic.
[Figure 2: U.S. Fund Net Flows — Equity and Bond Funds (Source: ICI)]
Yield Curve: Higher Yields Pressure Precious Metals
According to Wind data, after Warsh signaled that further rate hikes might be necessary, short-term interest rates became more sensitive to the policy path, while long-term yields reflected the combined effects of growth and inflation expectations.
The current interest-rate environment has two implications for precious metals:
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Nominal and real interest rates remain elevated, placing valuation pressure on non-yielding assets.
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However, non-commercial positions in COMEX gold and silver remain net long, indicating that under conditions of high interest rates and high uncertainty, funds continue to use precious metals as hedging instruments.
$黄金主连 2612(GCmain)$ $微黄金2612(MGC2612)$ $白银主连 2612(SImain)$ $白银主连 2612(SImain)$
[Figure 3: U.S. 10-Year and 3-Month Treasury Yields (Source: U.S. Treasury; blue: 10-year yield; yellow: 3-month yield)]
[Figure 4: COMEX Gold Non-Commercial Long and Short Positions (10,000 contracts; Source: CFTC; blue: long; yellow: short)]
[Figure 5: COMEX Silver Non-Commercial Long and Short Positions (10,000 contracts; Source: CFTC; blue: long; yellow: short)]
Thus, higher interest rates have not immediately reversed the bullish positioning structure in precious metals, but they have made prices more sensitive to changes in interest rates and the U.S. dollar, significantly increasing volatility.
Crude Oil: Geopolitical Premium Eases, Inventory Support Remains Limited
According to Bloomberg data, U.S. commercial crude oil inventories and Cushing crude oil inventories are compared with their respective five-year ranges, with 2026 data shown by the orange line. Crude oil prices retreated from their highs last week, with NYMEX crude settling at around USD 84 per barrel.
The main reason was that the market’s interpretation of developments involving Iran shifted from the risk of a supply disruption toward an economic and sanctions-related dispute. Arrangements concerning navigation through the Strait of Hormuz and progress on the Iran–Oman corridor reduced near-term supply concerns.
U.S. commercial crude oil inventories remained within the five-year range, with no significant drawdown that clearly exceeded seasonal patterns. Movements in Cushing inventories did not fully coincide with changes in nationwide inventories, suggesting that the local supply system had not tightened comprehensively.
Without a significant inventory drawdown, the rise in crude oil prices was driven more by geopolitical risks and supply expectations than by an actual tightening in physical supply and demand. The essence of this week’s crude oil market was therefore “geopolitical premium plus expectations trading,” rather than an “inventory-driven fundamental bull market.” If inventories do not continue to decline and break below seasonal patterns, the sustainability of the crude oil rally will remain constrained.$WTI原油主连 2610(CLmain)$ $小原油主连 2610(QMmain)$
[Figure 6: U.S. Commercial Crude Oil Inventories — Five-Year Range Comparison (2026 shown in orange; Source: EIA)]
[Figure 7: Cushing Crude Oil Inventories — Five-Year Range Comparison (2026 shown in orange; Source: EIA)]
Copper: Prices Lack Confirmation from Physical Inventories
Wind data cover copper inventories in Shanghai, at the LME, and at the CME. Copper prices were range-bound on both the LME and SHFE last week, with LME copper fluctuating around USD 14,200–14,300 per tonne.
The market was concerned about a potential tightening in supply caused by cancellations of LME warehouse warrants, but copper prices were also pressured by a stronger U.S. dollar and rising expectations for interest-rate hikes.
Inventories across the three major exchanges did not show a synchronized and sustained decline, indicating that the global copper market had not yet entered a clearly tightening supply-and-demand phase. Rising inventories in Shanghai alongside falling overseas inventories reflected regional flows of physical material more than a genuine improvement in global demand.$COMEX铜主连 2612(HGmain)$ $微型铜主连 2612(MHGmain)$ $迷你铜主连 2612(QCmain)$
[Figure 8: Shanghai Copper Inventories (10,000 tonnes; Source: Wind)]
[Figure 9: LME Copper Inventories (tonnes; Source: Wind)]
[Figure 10: CME Copper Inventories (10,000 tonnes; Source: Wind)]
With inventories still at elevated levels, the rise in copper prices was driven more by long-term demand expectations related to new energy and power-grid investment than by short-term physical tightness.
The core tension in the copper market was therefore that expectations were running ahead of physical confirmation. If inventories across multiple exchanges do not decline in sync, the upside for copper prices will face temporary constraints. Only when a clear inventory turning point emerges can previous demand expectations translate into an actual price driver.
Aluminum: Regional Inventory Divergence Drives Near-Term Volatility
According to Wind data, the inventory framework for aluminum is similar to that for copper, although regional divergence may be more pronounced. Changes in inventories across exchanges are affected not only by end-user demand, but also by delivery rules, financing trades, warehouse locations, and cross-market arbitrage.
Inventories across markets have not shown a consistent, synchronized decline, indicating that the aluminum market has not yet entered a phase of broad-based supply-and-demand tightening.$铝主连 2611(ALImain)$
[Figure 11: LME Aluminum Inventories (tonnes; Source: Wind)]
[Figure 12: Shanghai Aluminum Inventories (10,000 tonnes; Source: Wind)]
[Figure 13: COMEX Aluminum Inventories (tonnes; Source: Wind)]
Before a clear turning point appears in inventory data, increases in aluminum prices are likely to be driven more by expectations and fund flows than by physical tightness.
The defining feature of the aluminum market this week was therefore “regional inventory divergence plus warehouse-warrant flows driving short-term price elasticity.” Aluminum prices will receive firmer fundamental support only when inventories across multiple markets decline in sync and physical premiums improve.
Precious Metals: Bullish Positioning Persists, but Crowded Trades Amplify Volatility
According to Wind data, gold briefly reached a three-month high last week before profit-taking emerged around the release of the PCE data and Warsh’s remarks. COMEX gold fell by approximately 3% for the week, while silver pulled back by nearly 4%.
COMEX gold inventories did not decline significantly, indicating that deliverable supplies had not tightened materially. The rise in gold prices was driven more by fund flows and safe-haven demand. Non-commercial long positions in COMEX gold remained elevated, showing that speculative funds continued to favor the upside.
However, the excessive concentration of long positions has made the market more sensitive to changes in interest rates and the U.S. dollar, significantly amplifying volatility.$黄金主连 2612(GCmain)$ $微黄金主连 2612(MGCmain)$ $1盎司黄金主连 2612(1OZmain)$
[Figure 14: COMEX Gold Inventories (10,000 troy ounces)]
[Figure 15: COMEX Gold Non-Commercial Long and Short Positions (10,000 contracts; Source: CFTC)]
Silver has both precious-metal and industrial-metal characteristics. Changes in silver inventories and positioning should therefore be assessed together with trends in industrial metals such as copper and aluminum.
[Figure 16: COMEX Silver Inventories (100 million troy ounces)]
[Figure 17: COMEX Silver Non-Commercial Long and Short Positions (10,000 contracts; Source: CFTC)]
The essence of this week’s precious-metals market was that bullish positioning remained dominant, while crowded positioning and a high-interest-rate environment amplified volatility. If interest rates continue to rise, precious metals may face greater profit-taking pressure. If interest rates decline while inventories also fall, precious metals may gain more solid fundamental support.
Conclusion
At the macro level, sticky PCE inflation and Warsh’s hawkish remarks increased expectations for rate hikes, while volatility in the U.S. dollar and Treasury yields also increased. Precious metals experienced clear profit-taking at elevated levels.
At the fund-flow level, changes in equity and bond fund flows showed that macro allocations were still being adjusted and that risk appetite had not fully recovered.
For crude oil, the geopolitical premium eased and inventories remained within their five-year ranges, leaving the rally without sustained fundamental support.
For copper and aluminum, inventories across multiple exchanges have not yet provided a consistent signal of global destocking, meaning that further physical-market data are needed to confirm price gains.
For precious metals, COMEX non-commercial positioning showed continued participation by bullish funds, but crowded positioning and a rebound in interest rates remained the main risks.
The current environment is therefore better suited to a trading and research framework based on differentiating among individual commodities and monitoring turning points, rather than simply betting on a broad-based commodity rally. For crude oil, the key indicator is whether inventories continue to decline. For copper and aluminum, the focus should be on whether inventories across multiple markets decline simultaneously. For gold and silver, the key question is whether interest rates and non-commercial net positioning move in the same direction.
If prices continue to rise without improvement in inventory and fund-flow data, the fragility of the rally will increase. If an inventory turning point, a change in interest rates, and fund-flow trends are confirmed simultaneously, the trend foundation of the commodity market will become more solid.
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