BC Copper 2511 Fluctuated and Closed Higher, Interest Rate Cut Expectations Heat Up, Benefiting Copper Prices [SMM BC Copper Review]

Today, the most-traded BC copper 2511 contract opened at 75,750 yuan/mt, closed higher with a positive candlestick, showing a reduction in positions by bulls. During the night session, BC copper moved sideways initially, then fluctuated upward after the daytime opening, touching a high of 75,850 yuan/mt. Subsequently, the price center of copper shifted downward, probing a low of 74,970 yuan/mt, and finally settled at 75,530 yuan/mt, up 0.05%. Open interest decreased by 287 lots to 4,392 lots WoW, while trading volume reached 10,073 lots. On the macro front, the US Fed Beige Book indicated a slight decline in US consumer spending and a sluggish labour market. Additionally, US Fed Governor Milan called for accelerating the pace of interest rate cuts, supporting two more cuts within the year, which heightened market expectations for rate cuts and supported copper prices. On the fundamentals, supply side, imported materials arrived as supplements, while domestic supply remained stable. Demand side, copper prices continued to fluctuate at highs, significantly suppressing the purchase willingness of downstream enterprises, with most enterprises only making just-in-time procurement and showing insufficient initiative for stockpiling. Inventory side, as of Thursday, October 16, SMM copper inventories in mainstream regions across China increased by 5,500 mt to 177,500 mt WoW, and rose by 11,200 mt compared to the previous Thursday.

The most-traded SHFE copper 2511 contract settled at 85,050 yuan/mt. Based on the BC copper 2511 contract price of 75,530 yuan/mt, its post-tax price is 85,348 yuan/mt, resulting in a price spread of -298 between SHFE copper 2511 and BC copper. The spread remained inverted and narrowed compared to the previous day.