US Fed's December Rate Cut Remains Uncertain, Copper Prices Decline Again Overnight [SMM Copper Morning Comment]

LME copper opened at $9,019.5/mt overnight, initially rose slightly to $9,072.5/mt, then fluctuated downward, hitting a low of $8,950.5/mt near the close, and finally settled at $8,962.5/mt, down 0.9%. Trading volume reached 19,000 lots, and open interest was 269,000 lots. The most-traded SHFE copper 2501 contract opened at 74,020 yuan/mt overnight, initially peaked at 74,310 yuan/mt, then declined to a low of 73,670 yuan/mt during the session, and finally consolidated sideways to close at 73,760 yuan/mt, down 0.14%. Trading volume reached 29,000 lots, and open interest was 151,000 lots. Macro side, the US Fed's meeting minutes indicated that officials are inclined to cut interest rates gradually in the future, with some analysts already predicting a pause in rate cuts next month. Meanwhile, Trump promised to impose significant tariffs on Canada and Mexico. The US dollar index rebounded slightly, and all three major US stock indices closed higher, which was bearish for copper prices. Some analysts also noted that the inflation risk from the tariff hike could hinder the US Fed's rate cuts. Fundamentally, as trading shifted to cargoes with invoices dated next month yesterday, downstream buyers mostly sought cargoes with invoices dated this month. Some suppliers stood firm on quotes and were reluctant to sell, leading to overall poor market transactions. Recently, both imported and domestic copper arrivals in Guangdong have been low, and downstream orders in Guangdong have been strong, with some copper rod plants operating at full capacity. As a result, local inventories in Guangdong have almost depleted. Additionally, due to the still significant price spread between Shanghai and Guangdong, some east China cargoes are expected to move south, providing support for the bottom of the premiums. Price side, there remains significant macro uncertainty, and the market is awaiting more data from the US. Resistance to copper prices persists.