Trump's Tariff Remarks Boost US Dollar, SHFE Copper Resilient Overnight [SMM Copper Morning Comment]

SMM February 28 News: Overnight, LME copper opened at $9,452.5/mt, dropped back slightly at the beginning of the session, then rose to a high of $9,466/mt. Subsequently, it fluctuated downward, hitting a low of $9,368/mt near the session's end, before rebounding slightly to close at $9,413/mt, down 0.11%. Trading volume reached 18,000 lots, and open interest stood at 295,000 lots. Overnight, the most-traded SHFE copper 2504 contract opened at 77,140 yuan/mt, hit a high of 77,330 yuan/mt early in the session, then fluctuated downward, reaching a low of 76,930 yuan/mt near the session's end. It rebounded slightly to close at 77,150 yuan/mt, up 0.16%. Trading volume reached 29,000 lots, and open interest stood at 162,000 lots. Macro side, US initial jobless claims for the week ending February 22 recorded 242,000, the highest since the week ending December 7, 2024, indicating signs of an economic slowdown. However, Trump's clear statement that tariffs on Canada and Mexico will take effect on March 4, with reciprocal tariffs to follow on April 2, overshadowed the signs of slowing economic growth. The US dollar surged, pressuring LME copper, while SHFE copper showed strong bottom support. Fundamentally, as of Thursday, February 27, SMM copper inventories in major regions across China increased slightly by 2,000 mt from Monday to 376,000 mt, up 19,000 mt from last Thursday and 210,000 mt higher than before the Chinese New Year. The weekly inventory growth has significantly slowed this week. Looking ahead to next week, suppliers are expected to hold a tight supply outlook, with rumors of production cuts at some smelters, while demand is expected to improve. In terms of prices, with stocking demand ahead of the weekend, copper prices are expected to stabilize.