Metals prices to soften as growth slows: Moody’s

By James Langton | September 1, 2022 | Last updated on September 1, 2022
1 min read
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Amid slowing economic growth and weakening demand, Moody’s Investors Service is cutting its price expectations for an array of metals over the coming year.

The rating agency said it lowered its 12-month price assumptions for gold, silver, steel, aluminum and copper, citing slack demand as growth momentum slows.

The move follows cuts to Moody’s economic forecasts yesterday, reducing its call for G20 growth to 2.5% in 2022 and 2.1% in 2023, which represents a sharp slowing from 5.9% in 2021.

“China is a major consumer of base metals, coal and iron ore, and the largest steel producer globally,” said Barbara Mattos, senior vice-president with Moody’s, in a release. “A slowdown in the country’s economic growth would reduce demand across the metals and mining sector.”

She said prices, which have been volatile, “are decreasing from the peaks of late 2021 and early 2022 but will remain historically high.”

Alongside the lowered price expectations, Moody’s said supply will remain tight for most base metals during the coming 12 months, as production has lagged demand, and supply chain issues have further disrupted production.

While gold is often seen as a hedge against inflation, Moody’s noted that rising interest rates and bond yields also increase the opportunity cost of holding gold, weighing on its value.

Silver is expected to face similar price pressures as gold, it noted, even though the demand for silver is about 60% driven by industrial uses.

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James Langton

James is a senior reporter for and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.