As Powell Signals "Strongest Call for Rate Cuts," Copper Prices Were Boosted [SMM Copper Morning Comment]

Last Friday night, LME copper opened at $9,213.5/mt, initially fluctuating narrowly downward to a low of $9,174/mt. It then fluctuated widely upward, reaching a high of $9,299.5/mt. After a slight drop at the end of the session, it closed at $9,298/mt, up 1.95%. The trading volume was 16,000 lots and open interest was 280,000 lots. Last Friday night, the most-traded SHFE copper 2410 contract opened at 73,650 yuan/mt, initially dipped to 73,470 yuan/mt, and then fluctuated upward throughout the session, reaching a high of 74,330 yuan/mt near the end. It slightly retreated at the end, closing at 74,240 yuan/mt, up 0.9%. The trading volume was 65,000 lots and open interest was 155,000 lots. Macro-wise, last Friday night, Powell delivered the "strongest call for rate cuts" at the Jackson Hole Economic Symposium: the time for policy adjustment has come, and the probability of a 50 basis point rate cut by the US Fed in September increased after Powell's speech. The US dollar index fell, which was bullish for copper prices. Fundamentally, on the supply side, as the fourth quarter approaches, domestic smelters passively reduce production, and arrivals are limited. Domestic copper cathode social inventory continued to decline. On the consumption side, downstream restocking sentiment was high over the weekend, and overall consumption performed well. In terms of prices, influenced by a relatively strong macro sentiment, copper prices are expected to have some upward potential.