Fed Rate Cut Expectations Weaken, Precious Metals May Seek New Short-Term Lows

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　　Source: Quhe Futures

　　Research Report Content

　　[Gold]

　　A Pakistani diplomat stated that negotiations between the United States and Iran have "reached an impasse" and progress is "very slow." The US remains committed to maintaining its maritime blockade against Iran, while Iran considers the US blockade to be an obstacle to its participation in negotiations. Reaching an agreement with the US will take time, and the negotiation process "should not be rushed." Israeli Defense Minister Gallant stated that Israel is ready to restart war with Iran, "only waiting for a green light from the United States."

　　Comment: Negotiations have stalled again, and the market is watching to see if continued failure to reach an agreement will lead to persistent inflation, which could further impact expectations for the Federal Reserve's rate cuts. Gold prices are facing renewed pressure at the 60-day moving average, suggesting that gold may once again test lower points in the short term. In the medium term, high volatility remains the most likely scenario, requiring continued observation of stagflation logic and the Federal Reserve's policy direction.

　　[Platinum]

　　The US S&P Global Manufacturing PMI for April came in at a preliminary value of 54, higher than the expected 52.5 and the highest since May 2022. The Services PMI rose to 51.3, returning to the expansion zone. The composite PMI initial reading was 52, a three-month high. The price increases for goods and services were the largest since July 2022.

　　Comment: US economic data shows some resilience, boosting risk appetite and favoring platinum and other precious metals. However, recently, due to weakened expectations for Federal Reserve rate cuts, platinum and palladium, along with silver, have declined. In the short term, there is a possibility of further downside, but in the medium term, high volatility is still expected.

　　[Zinc]

　　On April 22, Zijin Mining released its report for the first quarter of 2026, showing that from January to March, total mined zinc output was 84,500 tons, down 4% year-on-year, and total refined zinc output was 89,800 tons, down 10.6% year-on-year. MMG's first quarter report showed zinc mine production of 50,200 tons, a 3% year-on-year decrease; output at Rosebery dropped by 16%, mainly due to lower zinc grades and a slight decrease in recovery rates.

　　Comment: The pace of additional global zinc mine supply has fallen short of expectations. The first quarter reports from both Zijin Mining and MMG confirm slowing mine production, and zinc concentrate processing fees remain negative, indicating that tightness at the mining end has yet to be fundamentally alleviated. On the demand side, peak season demand is clearly lacking, and domestic social inventories have slightly accumulated. Overall, cost support at the mining end remains strong, but sluggish domestic consumption and inventory accumulation are capping the upside. Zinc prices are expected to fluctuate in the short term.

Editor: Zhu Henan