Cooling expectations for an October rate hike support copper prices fluctuating at highs [SMM Copper Morning Comment]

Published: Oct 19, 2026 08:56 (GMT+8)

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SMM, October 19: Overnight, LME copper closed up 0.35%, driven by bear position reductions; SHFE copper closed down 0.03%, driven by bear position additions. Fed policy expectations and multiple geopolitical developments kept longs and shorts in a tug-of-war. Fundamentals showed tight spot circulation, and the price pullback stimulated a marginal recovery in downstream purchasing. Overall, copper prices are expected to show a narrow consolidation on a strong note today.

1. Overnight Futures

LME copper: Opened at $14,468/mt, hit a high of $14,509.5/mt, a low of $14,333/mt, and closed at $14,359.5/mt, up 0.35%. Trading volume was 18,800 lots, and open interest was 269,000 lots, down 1,283 lots from the previous trading day, driven by bear position reductions.

Most-traded SHFE copper 2611 contract: Opened at 110,000 yuan/mt, hit a high of 110,150 yuan/mt, a low of 109,400 yuan/mt, and closed at 109,420 yuan/mt, down 0.03%. Trading volume was 21,400 lots, and open interest was 177,000 lots, up 67 lots from the previous trading day, driven by bear position additions.

2. Macro Front

Fed Chairman Warsh declined to reveal future rate decisions. The market's probability of an October rate hike fell below 15%, and the US dollar index edged lower, providing some support to copper prices. On the geopolitical front, Ukraine attacked a Russian refinery, raising concerns about tighter energy supply, while Trump announced exemptions for multiple sanctions, restrictive measures, and tariffs on Russia.

3. Fundamentals

Supply side: Available spot cargoes were relatively tight, and suppliers showed a strong willingness to hold prices firm and hold back from selling. Demand side: The phased pullback in copper prices drove a marginal recovery in downstream purchasing sentiment, but the sustainability of orders under high copper prices still warrants attention.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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