Copper Prices See Volatile Week Amid Inflation Concerns
Copper prices experienced a volatile week, initially rising and then falling as investors digested data from the US. The LME copper price touched $14,384/mt on Wednesday before declining to $14,301/mt by Friday's close. The SHFE copper contract also saw significant fluctuations, reaching 109,030 yuan/mt but closing at 108,590 yuan/mt.
The rally in copper prices early in the week was driven by a strengthening US dollar and tight spot supply in China. However, the release of July PCE data showed inflationary pressure resurfacing, leading to increased expectations for US Fed interest rate hikes. This, combined with a stronger US dollar, put downward pressure on copper prices.
Despite this, copper prices recouped some losses by week's end as bulls added positions and the market digested the impact of PCE data. Looking ahead, investors will be focusing on Fed Chairman Walsh's speech at Jackson Hole and the upcoming release of US non-farm payrolls data.