USD: Commodity complex rallying – BBH

Brown Brothers Harriman (BBH) reports that the USD has pared back some gains, particularly against commodity-sensitive currencies. The report highlights a surge in AI capital expenditures, which is expected to drive commodities, especially precious and industrial metals.

AI spending boosts commodity currencies

"The commodity complex is rallying underpinned by a surge in AI capital expenditures plans. Amazon, Google, Microsoft, and Meta have forecast to spend a total of about $660bn in 2026 (2.1% of US GDP) for new data centers and equipment. That’s 60% higher than in 2025 and 165% higher than in 2024."

"Commodities, particularly precious and industrial metals, will keep benefiting from the ongoing AI spending boom. Every new server and power system requires large amounts of silver, gold, platinum, palladium, and copper, for high performance chips, wiring, and energy infrastructure."

"AUD, CLP, ZAR, BRL, MXN, and PEN all stand to outperform."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)