Eurodollar University Copper-to-Gold Ratio Hits Financial Crisis Levels: What You MUST Know
Sep 9, 2025
Gold prices are soaring, but it's not due to inflation. Instead, the copper-to-gold ratio has plummeted to record lows, signaling rising uncertainty in the economic landscape. The podcast dives into how stagnant copper prices coupled with gold's ascent reflect changing market expectations. Additionally, insights from the latest FRBNY survey reveal troubling job finding expectations, adding depth to the discussion on potential economic deterioration. This analysis offers a fresh perspective on the financial climate and its implications.
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Record Low Copper-To-Gold Reflects Probabilities
- The copper-to-gold ratio hitting a record low signals rising probabilities about the future rather than transitory shocks.
- Markets are pricing a long-run outlook where gold outpaces copper as economic downside becomes more likely.
Copper Versus Gold Reveals Real Demand
- Copper rising versus gold signals real-economy building and reflation, while gold signals financial shelter.
- Therefore a falling ratio usually denotes weaker demand to build and stronger demand for financial hedges.
Historical Cycles Drive The Ratio
- Historical cycles show the ratio falls during recessions and structural slowdowns and rises during booms tied to construction and tech.
- The 1990s rise in copper reflected global build-out, while post-2008 gold dominance reflects persistent low growth and financial volatility.