US Dollar Index Continued to Rise, Copper Prices Were Under Pressure [SMM Copper Morning Comment]

LME copper opened at $9,697/mt overnight, initially fluctuated lower to $9,626/mt, and then surged to $9,734/mt before declining to close at $9,648/mt, down 1.58%. Trading volume reached 19,000 lots, and open interest was 291,000 lots. The most-traded SHFE copper 2411 contract opened at 77,010 yuan/mt, dipped to 76,710 yuan/mt, then rose to 77,330 yuan/mt, and finally closed at 77,090 yuan/mt, down 0.55%. Trading volume was 37,000 lots, and open interest was 157,000 lots. Macro side, data showed the US economy only moderately slowed, aligning with expectations for a modest interest rate cut. US Fed Governor Waller also indicated more caution on rate cuts compared to the September meeting. The US dollar index continued its rise, reaching a 10-week high, negatively impacting copper prices. Additionally, Israel stated it would avoid targeting Iranian energy and nuclear facilities, causing international oil prices to plummet, further dragging down copper prices. Fundamentally, concentrated arrivals of imported copper are expected to continue until late October, with a large influx into the domestic market. Coupled with the upcoming delivery period for the SHFE copper 2410 contract, traders' willingness to sell has significantly increased, boosting copper cathode spot supply and impacting premiums and discounts. On the consumption side, downstream consumption growth was limited due to copper prices. According to SMM survey data, as of Monday, October 14, SMM copper inventories in major regions nationwide increased by 17,000 mt to 221,000 mt compared to last Thursday, continuing to rise post-holiday. Total inventory was 106,000 mt higher than the same period last year at 114,000 mt. Price-wise, with the strong US dollar, copper prices lacked upward momentum and are expected to maintain a fluctuating trend today.