U.S. Non-Farm Payrolls Data Beat Expectations, Interest Rate Cut Expectations Pull Back, Copper Prices Under Pressure and Retreat [SMM Macro Weekly Review]

Published: Feb 13, 2026 15:41

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Copper prices rose initially then pulled back this week. Early in the week, a pullback in the US dollar and escalating US-Iran tensions pushed LME copper to $13,400/mt and SHFE copper above 103,000 yuan/mt. However, better-than-expected US non-farm payrolls, a drop in the unemployment rate, and US Fed officials emphasizing persistent high inflation later cooled expectations for interest rate cuts. The US dollar stabilized and rebounded, triggering concentrated profit-taking by bulls and a rapid price decline. Approaching the Chinese New Year, capital turned cautious. Domestic demand was already weak, and high prices further dampened procurement, amplifying the adjustment. Ore supply disruptions persist but are unlikely to cause substantial production cuts in the short term.

Fundamentals, the spot market was sluggish this week as the Chinese New Year holiday neared. Both LME and SHFE copper showed deep contango structures, boosting traders' sentiment for stockpiling and arbitrage. Consequently, domestic and import premiums edged down only slightly. Holiday effects emerged on the demand side, with downstream stocking largely completed and procurement sentiment turning increasingly mediocre.

Post-holiday outlook, a significant inventory buildup is expected during the holiday, keeping overall copper prices under pressure. LME copper is forecast to fluctuate between $12,800-13,400/mt, while SHFE copper is seen moving between 98,000-103,000 yuan/mt. Spot side, on the first trading day after the holiday, spot prices against the SHFE copper front-month contract are expected to show a high premium due to SMM's consistent pricing against the front-month contract and the price spread between futures contracts, but this is expected to correct on the second day. Spot prices against the SHFE copper front-month contract are anticipated to range from a discount of 300 yuan/mt to a premium of 200 yuan/mt.

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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