Jeff Currie: Hoarding, dedollarization and a capex boom drive metals rally
Jeff Currie, Chief Strategy Officer of Energy Pathways at Carlyle and former Global Head of Commodities Research at Goldman Sachs, argues that a confluence of factors is driving the recent rally in industrial and precious metals. Copper — the classic growth indicator — is rising alongside silver and gold, which Currie says reflects more than dollar weakness. He attributes current commodity strength largely to hoarding amid supply concerns for critical minerals, plus emerging-market dedollarization after geopolitical events (notably the freezing of Russian reserves) that is pushing central banks to reduce holdings of Western bonds and increase non‑dollar assets like gold and physical metals. Silver receives special focus: Currie highlights its dual role as both an industrial input (notably for solar PV) and a store of value, making it particularly important to China’s industrial and energy strategy. Looking ahead, Currie expects a global capital‑expenditure boom — including spending on data centers and AI — that could trigger a new commodity supercycle. He also notes high interest rates are prompting investment into asset‑heavy, resource‑intensive industries. For traders, the main takeaways are elevated demand from hoarding and central‑bank diversification, structural industrial demand (copper, silver), and the potential for sustained commodity price support if a capex cycle materializes.
Bullish
The report signals a bullish outlook for commodity-linked markets and related financial assets. Key drivers cited—hoarding due to supply fears, central-bank diversification away from Western bonds, and a looming global capex cycle—point to sustained, structurally higher demand for industrial and precious metals (copper, silver, gold). Historically, similar combinations of supply concerns plus strong capex (1970s, 2000s) preceded prolonged commodity rallies. For crypto markets, the implications are twofold: (1) higher commodity prices and dedollarization trends can increase interest in non‑dollar stores of value, which can bolster demand for crypto assets perceived as alternatives to fiat (supportive for BTC and stablecoins adoption in emerging markets); (2) higher inflation or commodity‑driven input costs could increase short‑term volatility and risk‑off moves in risk assets. Short term, traders should expect elevated volatility in macro and commodity‑sensitive assets as markets price hoarding and reserve shifts. Medium to long term, a sustained capex‑led supercycle would be bullish for commodity prices and for assets (including some crypto use cases) tied to inflation hedging and cross‑border settlement outside the dollar. Risk factors that could blunt the bullish case include a rapid easing of supply constraints, a reversal in central‑bank allocation behavior, or a global demand shock that weakens capex plans.