Copper rose at the start of the week to a 15-month high amid generally higher risk appetite in the markets, as traders prepare for this week’s US Federal Reserve meeting and anticipate a long-awaited interest rate cut.
Futures contracts on the London Metal Exchange rose 1% to $10,173 per tonne, the highest level since June 2024. COMEX futures also gained 1.5% to $4.726 per pound, or approximately $10,419 per tonne.
Copper, the red metal and a bellwether for the global economy, has risen for six consecutive trading days this month, as a series of weak US economic data prompted traders to increase their bets on a Fed rate cut.
Copper: Traders Bet on Rate Cut
A 25-basis-point Fed rate cut is widely expected this week, after recent data showed signs of labor market weakness. Money markets are also pricing in a high probability of two more rate cuts by year-end.
Against this backdrop, equities continued their record rally on Monday, while Treasury yields and the dollar eased, making commodities like copper more affordable for foreign currency-denominated buyers.
In addition to monetary easing, the industrial metal has also been supported this year by relatively strong economic activity in China. Apparent consumption in the world’s largest copper market rose by about 10% in the first half of the year, according to the Zijin Mining Group.
