Copper hits four-month lows as traders focus on demand, AI and US rates
XLB•Copper fell 1.9% to $13,550 a metric ton, after touching a four-month low of $13,515, as traders weighed soft demand, AI-industry concerns and possible US rate hikes.
1. Copper falls to low
Benchmark copper on the London Metal Exchange fell 1.9% to $13,550 a metric ton by 1538 GMT, after reaching $13,515, its lowest since July 20. The selloff accelerated after the New York open as technology stocks fell following news that Nvidia CEO Jensen Huang was stepping down.
2. Demand and rates weigh
Panmure Liberum analyst Tom Price said US inflation concerns were prompting metals-market repositioning and weighing on copper. He added that industrial demand was soft and that technology-stock declines were part of the pressure, saying, “Every time AI takes a hit, copper demand and prices come under pressure too.” Fed officials have left open the possibility of a 50-basis-point rate increase at the December 8-9 meeting.
3. Aluminium tightness persists
The cash aluminium premium over the three-month contract climbed to a 36-year high above $175 a ton, partly due to historically low LME warehouse stocks, before easing to around $120. LME aluminium stocks were 226,350 tons, down nearly 56% since January; Shanghai Futures Exchange-monitored stocks fell 31% last week to 132,605 tons, their lowest since December.
