Commodities Super-Cycle: Gold Eyes $5,000 as Copper Squeezes on Supply Crunch

Global commodity markets are signaling a potential structural shift, with precious metals and industrial base metals rallying on a combination of geopolitical fear, supply constraints, and energy transition demand.

Gold: The Path to $5,000?

Citi has released a bullish forecast for the precious metals complex, projecting that Gold (XAU/USD) could reach $5,000 per ounce by Q1 2026. The bank cites a “crisis hedge” dynamic driven by three factors:

Silver is expected to outperform, with targets set as high as $100 per ounce, driven by the dual engine of monetary demand and industrial usage in photovoltaics.

Copper: The “Doctor” signals Shortage

Simultaneously, Copper prices have surged, breaching the $13,000/ton mark on the LME. The rally is fueling a debate between “artificial shortage” caused by potential US tariffs and “structural deficit” caused by a lack of mine supply.

• Supply Shock: Major production disruptions in Chile and sluggish new project approvals suggest a harsh supply deficit by 2026/2027.
• Inventory Crisis:LME inventories are at historic lows, creating a backwardation market structure where spot prices command a massive premium.

Macro Implications

The synchronized rise in gold and copper suggests markets are hedging against both currency debasement (Gold) and betting on a capital-intensive industrial cycle (Copper), despite the noise of short-term economic data.