Copper Surges on Tight Inventories and Weaker Dollar

Copper prices surged on Thursday as concerns over tight inventories resurfaced and the US dollar weakened following the Federal Reserve's decision to keep interest rates steady.

Benchmark three-month copper on the London Metal Exchange rose 1.4% to $13,767 per metric ton in official open outcry activity, rebounding from declines in the previous two sessions.

The weaker dollar made greenback-denominated commodities more affordable for buyers using other currencies, while dwindling inventories and supply concerns also contributed to copper's price increase.

StoneX analyst Natalie Scott-Gray noted that the market is transitioning from one driven by macro sentiment to one characterized by physical tightness, citing weather-related disruptions to mine supply and falling stocks on the LME and Shanghai Futures Exchange.