Dollar Strength Weighs on Copper as Geopolitical Tensions Escalate

Geopolitical tensions are escalating globally, putting pressure on commodity markets. The US dollar index is rising due to expectations of higher interest rates from the Federal Reserve and ongoing geopolitical conflicts. This has led to a decline in copper prices.

LME near-month contracts have seen a deep backwardation structure, causing the price spread between the COMEX and LME markets to reverse. As of press time, the COMEX 2609 contract is trading at a discount of about $88/mt to the LME 3M contract.