Copper futures rose above $4.22 per pound on Tuesday, recovering some of the losses from the previous session, despite fresh tariff warnings from US President Donald Trump that could potentially disrupt global commodity trade.
Copper rises despite Trump tariff concerns
Trump revealed plans to impose tariffs on imports of chips, pharmaceuticals, steel, aluminum, and copper, aiming to bolster domestic production and reduce reliance on foreign goods. This move added uncertainty to the market, particularly for copper, which is a key industrial metal.
Traders also remained cautious as they awaited the February 1 deadline for the first round of tariffs targeting China, Mexico, and Canada, as previously outlined by the President. These tariffs are expected to create further volatility in the global trade landscape, and market participants are closely monitoring any potential ripple effects.
Investors await the Fed
At the same time, investors are preparing for the US Federal Reserve's policy decision this week, where it is widely expected that interest rates will be kept unchanged. This decision could offer further insights into the central bank's approach to the economy and inflation, potentially influencing commodity prices.
Chinese markets remain closed
Additionally, trading volumes are expected to be lighter as Chinese markets remain closed for the week-long Lunar New Year holiday, which typically leads to reduced market liquidity and fewer trading activities. As a result, copper prices may experience more fluctuations due to these market conditions, with traders staying on edge as geopolitical and economic factors continue to evolve.
