Trump Urges Interest Rate Cut Amid Russia-Ukraine Negotiation News, Copper Prices Surge in Response [SMM Morning Comment on Copper]

SMM February 13 News: Overnight, LME copper opened at $9,396.5/mt, fluctuated rangebound initially, then dipped to $9,369.5/mt. During the session, it surged sharply and touched a high of $9,490/mt near the close, before pulling back slightly to settle at $9,469/mt, up 1.2%. Trading volume reached 17,000 lots, and open interest stood at 291,000 lots. Overnight, the most-traded SHFE copper 2503 contract opened at 77,100 yuan/mt, fluctuated rangebound initially and dipped to 76,930 yuan/mt, then fluctuated upward throughout the session, touching a high of 77,610 yuan/mt near the close and finally settling at 77,610 yuan/mt, up 1.07%. Trading volume reached 24,000 lots, and open interest stood at 181,000 lots. Macro side, US January CPI data exceeded expectations across the board, but Powell cautioned against overreacting and maintained a cautious stance on interest rate cuts. Before Powell's remarks, Trump urged the US Fed to cut interest rates, stating that such a move would complement upcoming policies. As a result, the US Fed may have to adjust rates in response to tariff policies. Additionally, two hours after the data release, Trump and Putin held a call, agreeing to negotiate an end to the Russia-Ukraine war. This news boosted the euro significantly, pressured the US dollar, and supported copper prices. Fundamentally, the market saw relatively small fluctuations yesterday. With the price spread between near-month contracts remaining around CNY 200/mt and market expectations for destocking in distant months, suppliers mostly opted to wait for delivery or position themselves for distant months, showing low willingness to sell. On the consumption side, copper prices fell back from highs, and downstream purchasing interest was moderate, leading to weak spot market activity in the short term. In terms of prices, copper prices are expected to have further upside room today.