Macro side, the US PPI monthly rate for July recorded a 0.9% increase, the largest since 2022, suggesting a widespread rise in inflation in the coming months. Following the data release, US Fed officials refuted expectations for a significant interest rate cut in September, causing the US dollar index to extend gains and putting pressure on copper prices.
Fundamentals side, supply side, although there was a replenishment of imported copper during the day, domestic supply remained tight. It is expected that arrivals of imported copper will continue to increase next week, potentially further improving the supply structure. Demand side, there has been a recovery trend. As we enter the latter half of August, downstream demand has gradually rebounded, driving a continuous decline in weekly inventory. Data shows that as of Thursday, August 14, SMM copper inventories in major regions across China decreased by 6,000 mt from Monday to 125,600 mt, a reduction of 6,400 mt from Thursday of the previous week.
Price side, Trump is scheduled to meet with Putin today to discuss the Russian conflict. Previously, it was expected that copper prices would fluctuate rangebound.