Copper Slips as China Demand Softens

Copper futures declined to around $6.45 per pound on Thursday, extending losses for a second consecutive session as expectations for tighter monetary policy in response to an energy-driven inflation shock weighed on demand prospects. A prolonged Middle East conflict and the near-closure of the Strait of Hormuz also continued to pressure global growth expectations. Strong US labor market data further reinforced bets that the Federal Reserve will raise interest rates this year, marking a sharp shift from earlier expectations of rate cuts. Elsewhere, traders are monitoring potential US tariff decisions that could impose duties on copper imports, prompting increased shipments into US ports ahead of any policy change. At the same time, Chile, the world’s largest copper producer, reported its weakest April output in 23 years, raising concerns over tightening global supply.

Copper decreased 2% to 6.5166 USD/Lbs

Copper futures fell below $6.6 per pound on Wednesday but remained close to the record high reached in the previous session amid uncertainty over a US tariff on the metal and tightening supply elsewhere. President Donald Trump earlier this week signed a proclamation adjusting tariffs on selected metal imports, but the order did not address the broader copper tariff issue. Traders are now awaiting a US decision later this month on whether to impose tariffs on refined copper imports. Meanwhile, Chile, the world’s largest copper producer, reported its weakest April output in 23 years, heightening concerns over constrained global availability. Demand prospects also remain supportive amid optimism around the expansion of artificial intelligence technologies and rapid data center buildouts. In addition, the ongoing transition toward cleaner energy systems is increasing demand from global power grid upgrades, reinforcing a generally bullish long-term outlook for the metal.