Jul 2026

Weekly round-up for Stonex Bullion

By Rhona O'Connell, Head of Market Analysis

Too much short-term noise around US numbers

Outlook: continued downside risk lurking in the background; watch the 10-year bond yield

Investment activity at the retail level remains quiet with Dubai currently trading at a $100 (2%) discount to loco London, while the Shanghai market premium has slipped towards neutral, following trade selling towards the end of last week. Oil and US yields eased with the hiatus in strikes in the Gulf and Iran stating that it has been holding talks with Oman in an effort to relieve the tension in Hormuz. This has given gold a degree of buoyancy, but only mildly so, while silver market commentaries are currently revolving around the oversupply in the solar cell market (and more reports of cells being manufactured with a copper paste). Solar cells comprised 20% of silver fabrication in 2025 (5,804t) but this is expected to drop by 19% this year, to take up 18% of the market as a result of this oversupply plus continued thrifting and efforts at substitution (Metals Focus numbers, StoneX estimate).

In our view the markets are overstating the significance of the weak CPI number for June; as we argued last week, over 90% of the fall was due to the tumble in energy prices. Despite the easing over the weekend, WTI is still 10% higher than at the start of July and we are expecting a strong CPI reading for July. The Fed’s July meeting is Tuesday/Wednesday of this week and there is a groundswell of support, among market commentators at least, for a July hike; given the volatility in energy prices and the lingering uncertainty over the outlook for the Gulf hostilities, we would expect the FOMC to keep rates on hold, but to adopt a comparatively hawkish stance. It will, of course, be interesting to see how the Statement (and in three weeks’ time the Minutes) are framed, and Kevin Warsh’s Press conference will be illuminating, if only as it throws light on how much he is prepared to say.

In the background, with the S.122 tariffs expiring last week, the S.301 tariffs now come into play. Including 60 countries that the US Administration believes have been benefiting from “forced labour”; there is a 10% tariff on countries that are deemed to have taken “meaningful steps” towards forced labour prohibition. These include Canada, Ecuador, the European Union, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia, Taiwan, and the United Kingdom; the remaining 45 will face tariffs of 12.5% while there has been a separate investigation into Brazil (digital trade, intellectual property and deforestation) and 25% has been proposed, on top of the 12.5% forced labour rate. Exemptions are similar to those under S.122 along with goods already subject to S.232 tariffs (steel, aluminium, autos and semiconductors). It appears that a number of manufacturers in the States are now starting to pass through their increased costs to the consumer, having previously been prepared to accept reduced margins so this, too, will likely provide some degree of inflationary pressure.

There is also a separate investigation into structural overcapacity in manufacturing in electronics, semiconductors, batteries and machinery; findings not yet published.

We maintain our view on gold and silver, in that narrow ranges remain the order of the day and we continue to believe that the downside is marginally more likely than sustained rallies.

Swaps market discounting a 31% change of a July hike but a 68% chance of one in September

Source: Bloomberg

WTI eases over the weekend after two nights of no attacks in the Gulf

Source: Bloomberg, StoneX

Meanwhile the 10-year yield has eased over the weekend with the fall in oil, but it is nonetheless higher than at end February, currently standing at 4.3%. This still provides a headwind for gold and, with its industrial bias, for silver.

Gold, just above the 10D and 20D moving averages (at $4,052 and $4072 respectively)

Silver’s moving averages are all inverted also

Source; Bloomberg, StoneX

The latest CFTC gold figures show fresh action in the week to 21st July (gold still in narrow ranges, gaining just $26 to $4,076), with a 3.3% (14.3t) gain in outright Managed Money longs and a similar increase of 3.3% (1.6t) in shorts. The outright long stood at 440t, which is 10% below the 12-month moving average. Silver was similar, with a 3.7% (104.5t) gain in outright longs and a more pronounced 14.4% (135.1t) rise in outright shorts. The outright long, at 2,926t, is 37% below the 12-month average.

In the Exchange Traded Funds sphere, the latest figures from the World Gold Council run to 17th July and show a year-to-date gain of just 15t, to 4,044t. Falls of 69t (3%) in North America, a gain of just 16t in Europe (1%) and of 66t (15%) in Asia. The Bloomberg figures to last Friday, however, which are not as comprehensive as those from the World Gold Council, show four consecutive days of net creations, for a net change over the week of 13t. While this implies a net 28t gain over the year, it also represents a fall of 99t from the mid-April high of 4,143t. Silver ETFs are reported at 24,413t, a drop of 2,408t in the year to date, with bargain hunting appearing in the latter part of last week, picking up 128t.

Gold COMEX positioning, Money Managers (t)

COMEX Managed Money Gold Longs as % of 1st continuation Open Interest