The global economy performed better than expected so far in 2023, but concerns about a cold winter, rising oil prices, high borrowing costs, and China's economic slowdown are looming large. Central banks are maintaining the narrative of higher-for-longer interest rates due to persistent higher prices, which has weighed on base and precious metals' performance. Despite pledges from Beijing to support the economy, current measures are not expected to have an immediate impact on the real estate sector, which means that there is unlikely to be a large-scale property development that would increase demand for stainless steel prices in the last quarter of the year. Nonetheless, the cumulative impacts of policy support and a dovish monetary policy in China should create a solid foundation for the economy to recover in 2024. Such a transition should push the sentiment from the oversold into neutral. News out of China and the US should bring stronger bounds of volatility in base metals’ performance in Q4 2023.

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. The Japanese yen is near the three-decade low against the dollar, reigniting speculation over another round of interventions from the government. Last year, for the first time since 1998, authorities stepped in as the local currency was approaching the 150 level. With the yen now fluctuating just below this level, will there be another move from the BOJ to intervene and push the currency higher?

Read our short coffee crop update, with commentary on recent price activity, and coffee market forecasts to take advantage of market movements. Since our last report in March 2023, coffee prices have remained broadly unchanged, above 170cts/lb, but the story remains centred around Brazil. Certified stocks have seen a considerable decline, further drawing down on available inventory from the region. While this should have been supportive of higher prices, futures have remained broadly unchanged. As we head into the harvesting period for Arabica, we begin to assess the outlook for the 23/24 crop in this report.

Our analysts provide an insight into the Electric Vehicle and Battery Material Market. They give an update on how the energy industries in major regions are transitioning towards renewable alternatives, new policies to support EV sales, and a fundamental outlook for Nickel, Cobalt, and Lithium. Supply-chain bottlenecks and strong EV consumption have meant a sharp increase in the prices of materials and chemicals. Will this continue?

Our daily commentary, covering market news and closing prices of LME aluminium, copper, lead, nickel, tin, zinc, iron ore, steel, and precious metals.

Our FX Options Report contains commentary and analysis covering OTC currency option pricing, volatility and positioning. USDBRL has been subject to fluctuation in recent months, given the uncertainty surrounding the monetary policy outlook from both the BCB and the Fed. With Brazil set to continue on its dovish path and the US’ peak rates being priced in, what is the outlook for USDBRL in the near term?

Technical analysis and charts for the key sugar, cocoa and coffee contracts.