Macrowaves: Signposts for the Emergence of a Real Cycle

Research evidence excerpt

Macrowaves: Signposts for the Emergence of a Real Cycle

Global | Metals & Mining EquityJuneResearch9, 2026

Macrowaves: Signposts for the Emergence of a The copper price appears to have deviated

from PMI data in recent months, butReal Cycle history suggests a sustained recovery in US

We have discussed in our prior Macrowaves notes the importance of money manufacturing should still drive incremental

demand from a higher base.

supply growth as a leading indicator for prices of industrial commodities. Global

M2 is now accelerating, led by the US, and industrial activity in the US is showing

upward momentum following three years of mixed signals. A capex cycle for AI Exhibit 1 - Copper & US Manufacturing PMI

and data center infrastructure appears to be here as well. This setup should be US ISM, YoY Change (Lagged 6m) Real Copper Price, YoY Change

most positive for the prices of industrial metals. 80% 170%

PMI 60% 120%

R2: 0.7 Price

40%

70% CopperManufacturing PMI: Exhibit 1 illustrates the remarkably strong relationship between changes in the Manufacturing 20% Real

20% inUS ISM manufacturing PMI and changes in real copper prices. R2 is highest (0.7) when changes ISMUS

in 0% Changein the PMI are lagged by 6 months, suggesting expected growth in U.S. manufacturing has been Change -20% -30%

an effective leading indicator for the price of copper over the past 20 years. The relationship

exists because PMI data captures forward-looking components such as new orders and production -40% 2007 2008 2009 2009 2010 2011 2012 2013 2014 2014 2015 2016 2017 2018 2019 2019 2020 2021 2022 2023 2024 2024 2025 -80%

expectations, which typically translate into changes in demand for copper used across machinery, .Source: Bloomberg, Institute for Supply Management,

FactSet, U.S. BLS, Jefferies