Copper Surges on Weaker Dollar and Fading Rate Hike Expectations
Copper prices have surged on expectations of a weaker dollar and fading hopes for a September Federal Reserve rate hike. According to Kedia Advisory, copper settled 0.83% higher at 1382.3, marking a significant gain in the industrial metal.
The US factory activity slowed down in August due to elevated input prices, raising concerns over industrial demand. Meanwhile, supply concerns remained supportive, with SHFE-monitored copper stocks falling more than 19% last week and on-warrant inventories standing at 31,462 tonnes.
Chilean copper production declined by 9.4% year-on-year in July to 403,424 tonnes from 445,322 tonnes, affected by severe storms, unfavorable weather conditions, and maintenance at major mining sites. The global refined copper market recorded a 60,000-tonne deficit in June compared with a 15,000-tonne surplus in May.
The technical outlook for copper suggests short covering as open interest declined 1.46% to 10,672 while prices gained Rs 11.35, indicating reduced bearish positioning and improving momentum. Overall, the near-term bias remains positive while supply tightness and dollar movements remain key drivers.