Copper prices edged down as market awaiting Fed meeting

LME copper prices opened at $8430/mt and closed at $8409/mt last Friday evening, a drop of 0.34%, with the high-end of $8442.5/mt and the low-end of $8388/mt. Trading volume was 15,000 lots and open interest stood at 264,000 lots. The most active SHFE 2310 copper contract prices opened at 69490 yuan/mt and finished at 69320 yuan/mt last Friday evening, down 0.47%, with the low-end of 69210yuan/mt and the high-end of 69529 yuan/mt. Trading volume was 31,000 lots, and open interest stood at 164,000 lots.

On the macro front, the Federal Open Market Committee (FOMC) is expected to keep interest rates unchanged in the range of 5.25-5.5% at its meeting on September 19 and 20, and will maintain this level until the first interest rate cut in May next year.

As of Friday September 15, SMM data showed that copper inventory across major Chinese markets stood at 100,900 mt, up 5,800 mt from last Monday and up 400 mt from two Fridays ago. Inventories have increased for three consecutive weeks. The inventory in East China increased due to the large arrivals of imported copper, while the increase in inventory in South China was mainly caused by the large shipments from smelters before delivery and weak consumption. Copper prices will not change much in the near future.