Copper prices steady amid China growth, strong dollar

Copper futures remained unchanged, around $4.02 per pound, on Monday as investors evaluated the economic outlook for China, the world’s largest consumer of copper.

Copper prices steady amid China growth, strong dollar

Beijing recently committed to implementing "more proactive" macroeconomic policies, including lowering interest rates in 2024, to spur economic growth. Furthermore, data revealed that China’s services sector grew at its fastest pace in seven months in December, signaling strong consumer demand and offering some support to copper prices. However, copper and other commodities faced headwinds from a strong US dollar, primarily driven by expectations that the Federal Reserve will implement fewer interest rate cuts this year.

Strong dollar caps copper’s upside despite China's growth

A stronger dollar makes commodities in US dollars more expensive for foreign investors, putting additional pressure on prices. Despite the positive signs from China’s economy, the dollar's strength could limit copper's upside potential in the short term.