US Dollar Index Rises, Copper Prices Fall Overnight [SMM Copper Morning Comment]

Overnight, LME copper opened at $9,693.5/mt, initially dropped to $9,680/mt, then fluctuated upwards, hitting a high of $9,816.5/mt during the session, and finally fluctuated widely to close at $9,805/mt, with a drop of 0.77%. Trading volume rose to 25,000 lots, and open interest stood at 332,000 lots. Overnight, the most-traded SHFE copper contract (2407) opened at 79,390 yuan/mt, initially hit a high of 79,700 yuan/mt, then fluctuated downwards to a low of 79,130 yuan/mt, hovered sideways during the session, and rebounded at the end to close at 79,530 yuan/mt, with a drop of 0.7%. Trading volume rose to 44,000 lots, and open interest stood at 172,000 lots. On the macro front, the World Bank revised the global GDP growth forecast for 2024 from 2.4% to 2.6% and the US GDP growth forecast from 1.6% to 2.5%. The strengthening US dollar inhibited copper prices. Additionally, the market is paying attention to the US CPI data to be released tonight and the interest rate decision early Thursday morning. In terms of fundamentals, copper prices fell, leading to a rebound in purchasing volumes from downstream processing enterprises, but some remain in a wait-and-see sentiment, resulting in relatively limited overall demand recovery. The market is watching whether copper prices will continue to decline in the future. SMM learned that as of Tuesday, June 11, copper stocks in mainstream areas of China fell by 8,600 mt MoM to 442,100 mt, still 98,400 mt higher YoY, mainly due to an increase in cargo pick-up by downstream enterprises. The prices are expected to run at a relatively low level.