US Fed's Hawkish Stance Continues, Copper Prices Under Pressure Overnight [SMM Copper Morning Comment]

Last Friday night, LME copper opened at $9,722.5/mt, surged to a session high of $9,793/mt in early trading, then fluctuated downward to a session low of $9,705.5/mt, before rebounding and finally closing at $9,772.5/mt, with open interest at 334,000 lots. Last Friday night, the most traded SHFE 2407 copper contract opened at ¥79,410/mt, hit a session high of ¥79,530/mt in early trading, then fluctuated downward to a session low of ¥78,760/mt, rebounded at the end of the trading session, and finally closed at ¥79,290/mt, marking a decline of 0.49%, with trading volume at 41,000 lots and open interest at 174,000 lots.

On the macro front, US Fed officials maintained a hawkish strategy, indicating the need to see more evidence of declining inflation and suggesting a possible rate cut by the end of the year, which boosted the dollar and pressured copper prices. On the fundamentals side, the supply side saw a certain amount of imported copper arriving over the weekend. In terms of consumption, copper prices have been trending lower, and with the delivery date approaching, downstream buyers exhibited some caution, leading to a slight recovery in overall transactions. If copper prices remain stable, consumption may further improve. Overall, with the dollar remaining strong, copper prices are expected to face some upward pressure.