Copper falls amid tariff fears and trade war concerns

Copper futures dropped to around $4.22 per pound on Thursday, hitting a two-week low as fears of a global trade war sparked by potential new US tariffs under President Donald Trump raised concerns about weaker demand for essential resources like copper.

Copper falls amid tariff fears and trade war concerns

Earlier this week, Trump revealed that his team was considering a 10% tariff on China, set to take effect as early as February 1, following previous threats of 25% tariffs on Mexico and Canada. He also mentioned the possibility of tariffs on the EU, although without further details. Market sentiment was further dampened by caution ahead of China's Lunar New Year holiday and upcoming interest rate decisions from the Bank of Japan and the US Federal Reserve.

Hope for China stimulus boosts market sentiment

Nevertheless, there is still some hope that China will introduce additional stimulus measures, with state media reporting that the People’s Bank of China may lower the reserve requirement ratio for banks later this month.