Macro Support and Inventory Reduction Pushed Copper Prices Higher Overnight [SMM Copper Morning Comment]

SMM March 25 News: LME copper opened at 10,030.5 yuan/mt overnight, reaching a high of 10,044.5 yuan/mt and a low of 9,930 yuan/mt, closing at 9,934.5 yuan/mt. The overall trend fluctuated upward before pulling back after hitting the high. The gain was 0.84%, with a trading volume of 15,000 lots and open interest of 298,000 lots. The most-traded SHFE copper 2505 contract opened at 82,010 yuan/mt, reaching a high of 82,110 yuan/mt and a low of 81,460 yuan/mt, closing at 81,490 yuan/mt. The overall trend showed a fluctuating downward pattern. The gain was 0.65%, with a trading volume of 51,000 lots and open interest of 244,000 lots. On the macro front, the US S&P Global Manufacturing PMI for March hit a new low, raising concerns about US economic growth. Meanwhile, Trump's tariff measures increased uncertainty, leading to a rise in risk-averse sentiment, which boosted copper prices. Additionally, Trump called for an interest rate cut by the US Fed during a cabinet meeting, further supporting copper prices. Fundamentally, on the supply side, national social inventory continued to decline over the weekend. As of Monday, March 24, SMM's copper inventory in major regions decreased by 12,800 mt to 333,600 mt compared to the previous Thursday, and by 15,400 mt compared to the previous Monday. The current inventory level raises concerns about Q2 supply. On the demand side, downstream buyers mostly maintained just-in-time procurement, but buying interest is gradually warming up, showing some positive changes compared to before. In terms of price, the resonance of macro and fundamental factors suggests that copper prices are expected to have further room for increase today.