Copper is near record highs, yet the copper/gold ratio is back at levels associated with much weaker growth. The question is whether the signal still works when both metals are being driven by forces that have little to do with the traditional cycle.
Originally published on LinkedIn (opens in a new tab), 17 June 2026.
Copper is near records: around $13,700 a tonne on the LME on June 17, after touching highs above $14,500 in late January. On its own, that reads like a booming world economy.
But there is another related indicator worth looking at: the copper/gold ratio, which is copper's price divided by gold's. The logic is elegant. Copper is the "growth" metal, gold is the "fear" metal, so the ratio is meant to strip out the noise and show risk appetite. It even used to track the US 10-year bond yield fairly closely.
That is what makes the current signal so interesting. Copper itself is near record highs, but the copper/gold ratio has fallen to levels last seen roughly half a century ago. In the old textbook reading, that would usually point to recession risk and weakening industrial demand.
Except copper hasn't collapsed, it's up sharply. The ratio is low because the denominator ran away: gold is up roughly 30% over the past year, after an extraordinary 2025 in which it gained more than 60%, driven by central-bank buying and geopolitical worry. And the old link to bond yields has quietly broken, with the 10-year holding in the mid-4% range while the ratio said something else entirely.
So both halves of this famous indicator seem to be doing something it wasn't designed for. Copper is being pulled up by AI data centres, grids and EVs as much as by the cycle. Gold is being pulled up by central banks and fragmentation as much as by fear.
My tentative takeaway, as someone still early in this: these tidy ratios assume each metal means one thing. Right now both are wearing new hats, so the signal may be telling us less about growth and more about how the world is rewiring.
Is the copper/gold ratio still useful here, or has it quietly stopped meaning what the textbooks say? Genuinely curious how people who actually use it are reading it now.
The threat of a US tariff on refined copper has already pulled an extraordinary amount of metal into American warehouses. No tariff has been imposed, but the uncertainty itself has created something close to a privately funded strategic stockpile.
VLCC volumes fell as Hormuz disrupted traditional Gulf flows, but longer Atlantic-to-Asia voyages absorbed more vessel time. That has supported freight despite fewer barrels moving — but the effect could unwind quickly if trade routes normalise.
Iran asked ships to pay for passage through Hormuz. Now the US is proposing its own charge for providing security. The bigger concern is not the price, but the precedent: once free transit through an international strait becomes negotiable, the principle itself starts to weaken.