Copper futures rose to $4.06 per pound, recovering from a three-month low of $4.02 reached on December 20th, supported by a slight decline in the dollar as markets evaluated the prospects for Chinese industrial demand.
Copper inches higher from three-month low
Softer US PCE inflation data for November bolstered hopes that the Federal Reserve might implement more rate cuts than anticipated in its recent hawkish dot plot, boosting dollar-priced assets and alleviating concerns over weak US manufacturing activity. However, the lack of concrete details from China regarding its commitments to proactive fiscal support fueled skepticism, raising concerns that these announcements may serve as symbolic gestures rather than substantive measures.
Macro impact on copper prices
Meanwhile, the latest PMI data indicated only marginal growth in Chinese manufacturing activity in November, showing little impact from substantial monetary easing introduced in September. Additionally, the outlook for Chinese manufacturing was further challenged by potential tariff threats from the incoming Trump administration in the US, tempering demand from the world’s largest copper consumer.
