Copper prices surged on Tuesday, nearing $6.80 per pound, just 2% below the record high set in September. This rally is driven by easing concerns over a US rate hike and recent mining disruptions in Chile. On the London Metal Exchange, copper prices rose 0.5% to approximately $6.63 per pound, marking a 17% increase since the start of 2026.
The Federal Reserve's decision to raise rates by 25 basis points in September, lifting the target range to 3.75%, 4.00%, initially raised fears of further hikes. However, traders now see an 80.6% probability that the Fed will hold rates at its October 28 meeting, which could ease pressure on industrial metals like copper.
Supply disruptions are tightening the copper market. A mudslide at Codelco’s El Teniente mine in Chile killed two workers and partially halted operations. Meanwhile, other major mines like Escondida and Centinela have faced operational issues, contributing to a projected copper deficit of about 600,000 tons this year. Long-term demand forecasts also add to the bullish outlook, with copper demand expected to jump 50% by 2040, according to Coppernico Metals CEO Ivan Bebek.
Analysts predict copper prices could continue rising, with $7 per pound as the next major target. However, there are signs the rally may be weakening. The Relative Strength Index (RSI) suggests momentum has softened, and copper is trading within a narrowing upward range, which could signal an impending correction. The next major test will come with the US inflation figures released on October 14, which could influence the Federal Reserve's rate decisions and, consequently, copper prices.