Copper Set for Weekly Drop

Copper fell around $5.6 per pound on Wednesday, giving back earlier gains as the initial relief from easing geopolitical tensions in the Middle East faded. Although US President Donald Trump suggested military strikes on Iran could wind down within two to three weeks, uncertainty around the conflict continued to weigh on sentiment. Broader demand concerns also persisted, even as hopes of reduced oil-driven inflation pressures briefly supported the outlook for industrial metals. A softer US dollar offered limited cushioning, but was not enough to offset overall caution in the market. In China, demand signals remained uneven, with inventory movements at the Shanghai Futures Exchange offering only modest reassurance about consumption trends. China’s RatingDog Manufacturing PMI for March also eased to 50.8, below expectations of 51.6 and down from 52.1 in February.

Copper held steady near $5.5 per pound on Tuesday but remained on track to lose nearly 10% in March, marking its worst monthly performance since July last year. Copper and other industrial metals have come under sustained pressure this month as disruptions from the Middle East conflict and surging energy prices raised concerns about inflation and slowing global industrial activity. Copper miners are also expected to face higher costs and weaker profitability due to heightened uncertainties surrounding the Iran war and the effective closure of the Strait of Hormuz. The conflict has disrupted oil and LNG shipping, affecting copper operations that rely heavily on these energy sources. Many mining sites depend on diesel-powered machinery, while processing mills typically rely on stable grid power to refine ore.

Copper held below $5.5 per pound on Monday, struggling for traction as investors navigated ongoing hostilities in the Middle East that showed no signs of easing. Tensions escalated as Iran-backed Houthi militants in Yemen joined the conflict, targeting Israel over the weekend. President Donald Trump also said he could “take the oil in Iran,” echoing the US military operation in Venezuela earlier this year. Copper and other industrial metals have come under pressure this month as disruptions from the conflict and surging energy prices heightened concerns over inflation and slowing global industrial activity. Upward price pressures have also reinforced expectations that major central banks may raise interest rates this year, with markets now pricing in a potential rate increase from the Federal Reserve, a sharp reversal from earlier expectations for two rate cuts.