JPM | Commodities & Rate hike cycles, US reinstates Hormuz Blockade, Nanya plastics Raise PT, Chalco first glance, Copper Cochilco data

Research evidence excerpt

JPM | Commodities & Rate hike cycles, US reinstates Hormuz Blockade, Nanya plastics Raise PT, Chalco first glance, Copper Cochilco data

Specialist Sales

APAC Specialist Sales J P M O R G A N

14 July 2026

transit is compromised, this could add further stress to an already distressed market, and we would expect a notable amount of

risk prem to be priced into spot prices. View from here is that crude could continue to move higher as the Strait remains

closed and the overhang from the initial reopening continues to clear.

A HAWKISH WALLER: Commodities & Materials sold off 20% in last hiking cycle

• Perhaps just as relevant for commodities is Fed governor Waller’s most hawkish commentary since 2024 – he argued

overnight that interest rate hikes should be on the table if this week’s inflation data comes in hot. Markets are now pricing in a

42% chance of a hike in the September meeting, and all eyes will be on CPI print tonight and PPI print this week.

• Specific comments from Waller - “If we get another hot reading on core inflation this week, then the FOMC will need to

consider tightening monetary policy in the near term.” “I would be very pleased to see a lower reading on core inflation, but

after its escalation over the first half of this year, I will need to see several months of lower readings to feel that inflation is

moving in the right direction.”

• This matters for Commodities: In our last rate hike cycle (2022-23) – The Bloomberg commodities Index (BCOM) was

down 23% from the first Fed hike to the last. MSCI’s AxJ Materials Index was (MXASJMT Index) was down 18% in the

same time frame (with big declines seen before and after as well) & the global copper miners ETF (COPX) was down -40%

from peak to trough in that cycle (with COPX ending -20%) in that period.