US Fed Interest Rate Cut Likelihood Increases, Overnight Copper Prices Supported [SMM Copper Morning Comment]

SMM January 16 News: Overnight, LME copper opened at $9,121/mt, briefly bottomed at $9,117/mt during early trading, then fluctuated upward, peaking at $9,219/mt near the session's end, and finally closed at $9,217/mt, up 0.58%. Trading volume reached 18,000 lots, and open interest stood at 280,000 lots. Overnight, the most-traded SHFE copper 2503 contract opened at 75,450 yuan/mt, briefly bottomed at 75,320 yuan/mt during early trading, then climbed steadily, peaking at 76,080 yuan/mt during the session, and fluctuated rangebound near the end, closing at 75,900 yuan/mt, up 0.69%. Trading volume reached 40,000 lots, and open interest stood at 159,000 lots. Macro side, the US overall CPI YoY growth rate mildly rebounded to 2.9%, while core CPI YoY growth rate unexpectedly pulled back to 3.2%, below expectations, easing concerns about accelerating inflation. Traders increased bets on a US Fed interest rate cut in June, with the likelihood of two rate cuts this year rising. Following the data release, the US dollar index briefly fell below the 109 mark, boosting overnight copper prices. Fundamentally, as year-end approaches, weak consumption and contract rollover have led to a subdued market with overall muted transactions. In summary, after pulling back, the US dollar index regained ground, and copper prices are expected to have limited upside today.