Copper prices fell 1.2% to $14,319 a ton on the London Metal Exchange, extending losses for a third consecutive day. The decline follows stronger-than-expected US consumer price index data, fueling bets that the Federal Reserve will implement more aggressive interest rate hikes. A risk-off market tone has pressured commodities, with technology stocks also bearing the brunt of the selloff.
Analysts note that the inflation data raises concerns about cooling economic demand and increasing manufacturing costs for metals. Copper had previously reached a record high but has since wavered amid uncertainty over the Fed's pathway. The metal remains up over 15% year-to-date after significant flows to the US ahead of anticipated import tariffs.
However, optimism driven by artificial intelligence infrastructure spending has also created bullish exposure. Mining equities declined, with BHP Group and Antofagasta Plc both seeing significant drops. Easing concerns over immediate supply disruptions, following BHP's preliminary agreement with Escondida mine employees in Chile, also contributed to the downward pressure.
Analysts from Sucden Financial expect the complex to remain defensive due to a firm dollar and renewed rate pressure, with limited support from remaining supply risks. The Bloomberg Dollar Index climbed to its highest level since May 2025.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing