Last Friday evening, LME copper opened at $8,648.5 per tonne. After an initial fluctuation and upward movement, it fell to a low of $8,656 per tonne. During the trading session, it experienced wide fluctuations and reached a high of $8,695 per tonne. Finally, it closed at $8,671 per tonne, with a trading volume of 20,000 tonnes and an open interest of 272,000 tonnes, representing a decrease of 0.41%. The main Shanghai copper contract, 2308, opened at 69,480 yuan per tonne. It initially fluctuated downward to a low of 69,230 yuan per tonne, then rebounded and reached a high of 69,540 yuan per tonne during the trading session. Finally, it closed at 69,380 yuan per tonne, with a trading volume of 31,000 lots and an open interest of 205,000 lots, representing a decrease of 0.1%. In terms of macroeconomic factors, as inflation softens, the Federal Reserve is believed to be nearing the end of its rate hike cycle.
Last week, the US dollar hit its largest weekly decline since November against a basket of six major currencies. In terms of fundamentals, as of last Friday, July 14th, copper inventories in major regions across China decreased by 8,600 tonnes compared to the previous Monday, reaching 117,000 tonnes, a decrease of 3,300 tonnes compared to the previous Friday. Specifically, the Shanghai region showed a decrease in inventories, mainly due to a year-on-year decrease in imported copper and spot discounts, which provided purchasing opportunities for some downstream manufacturers. On the other hand, Guangdong region showed an increase in inventories, mainly due to increased deliveries from surrounding smelters approaching the delivery week. In terms of consumption, the high copper prices have put pressure on demand, but if the focus shifts lower after the contract rollover, demand is expected to increase.
As for prices, it is widely expected that the Federal Reserve's tightening policy is entering its final phase, and it is predicted that copper prices will remain at high levels in the near term.
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