US Dollar Index Rebounded, Copper Prices Declined Overnight [SMM Copper Morning Comment]

LME copper opened at $9,279.5/mt overnight, initially dipped slightly before rising, reaching a high of $9,306/mt during the session, then declined all the way to a low of $9,233.5/mt near the close, and finally closed at $9,238.5/mt, down 1.92%. Trading volume reached 17,000 lots, and open interest reached 283,000 lots. The most-traded SHFE copper contract 2410 opened at 74,250 yuan/mt overnight, initially reached a high of 74,520 yuan/mt, then slightly declined during the session, reaching a low of 74,060 yuan/mt near the close, and finally slightly rebounded to close at 74,300 yuan/mt, down 1%. Trading volume reached 39,000 lots, and open interest reached 163,000 lots. Macro-wise, the US dollar index recorded its largest gain since June 3, which is bearish for copper prices. Additionally, a spokesperson from the US Department of Labor stated that the release of employment data for August 21 was delayed due to technical issues, and the market needs more economic data for guidance. Attention is focused on the PCE data to be released on Friday, which is the US Fed's preferred inflation indicator. Fundamentally, on the consumption side, end-of-month downstream transactions for cargoes with invoices dated next month are limited. Traders reported mediocre trading volumes, with downstream buyers preferring to transact directly with smelters. According to the survey, destocking at smelters in east China has increased compared to before, and overall consumption remains resilient. Price-wise, the downside space for copper prices is expected to be limited.