Copper jumped to a 15-month high on Monday amid a broader risk-on rally, as traders prepare for this week’s US Federal Reserve meeting with the expectation of a long-awaited interest rate cut.
Futures on the London Metal Exchange rose by 1% to $10,173 a ton, the highest since June 2024. Those on the COMEX also gained 1.5% to $4.726 a pound, or about $10,419 a ton.
Copper, a bellwether for the health of the global economy, has now risen for six consecutive trading sessions, as a stream of weak US economic data led traders to raise their bets on the Fed cutting rates.
It is widely anticipated that a quarter-point rate cut will come this week, after new data showed signs of labour market weakness. Money markets are also pricing in a high likelihood of two additional cuts by year-end.
Against that backdrop, equities resumed their record-breaking run on Monday, while Treasury yields and the dollar dipped, making commodities such as copper more affordable for buyers using foreign currencies.
In addition to monetary easing, the industrial metal has also been supported this year by strong activity in China. Apparent consumption in the world’s biggest copper market rose by about 10% in the first half, according to Zijin Mining Group. (With files from Bloomberg)
