Copper climbs to 15-month peak ahead of Fed rate decision

[Copper pipes on warehouse.]
Axe_Olga/iStock via Getty Images

Copper (HG1:COM [https://seekingalpha.com/symbol/HG1:COM]) prices surged to their highest level in more than a year, lifted by a broad market rally and growing expectations that the U.S. Federal Reserve will begin cutting interest rates this week.

Benchmark contracts on the London Metal Exchange advanced 1% to $10,173 a ton, the strongest level since June 2024. Traders are widely anticipating a quarter-point cut, with markets also assigning a high probability to two more reductions before year-end.

Softer U.S. labor data and dovish signals from policymakers have strengthened those bets. Lower borrowing costs generally support commodities like copper by stimulating demand and weakening the dollar, which makes dollar-denominated metals cheaper for overseas buyers.

Copper (HG1:COM [https://seekingalpha.com/symbol/HG1:COM]), often viewed as a gauge of global economic momentum, has now posted six straight days of gains. The rally has coincided with record-setting moves in equities, falling Treasury yields, and a softer U.S. currency.

China’s demand has been another tailwind. Zijin Mining Group estimates apparent copper consumption in the world’s largest market rose about 10% in the first half of the year, though analysts warn growth may cool in the months ahead.

Other industrial metals also gained on Monday. Aluminum was up 0.4%, zinc added 0.6%, and nickel rose 0.4% as of 4:30 p.m. in London.

ETFS: (CPER [https://seekingalpha.com/symbol/CPER]), (COPX [https://seekingalpha.com/symbol/COPX]), (OTC:JJCTF [https://seekingalpha.com/symbol/SM])

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