Copper prices on the London Metal Exchange (LME) rose slightly today due to ongoing supply disruptions. Production at Anglo-American’s Los Bronces copper mine in Chile is expected to drop by approximately 30% due to plant maintenance. Additionally, deteriorating production at several other mines, particularly in Latin America, has exacerbated concentrate shortages. Significant mining disruptions in Peru, Panama, and Zambia have further contributed to the price surge.
Despite these supply issues, rising protectionism, such as the European Union’s proposed tariffs on Chinese-made electric vehicles, could negatively impact copper prices. According to Kedia Advisory, these tariffs might weigh on the red metal’s market. Recent economic data from China has shown weak demand for copper in its largest market, potentially limiting further price increases. As of 0748 IST, the three-month copper contract on the LME was trading at $9,549.5 per ton, up 0.1% from the previous close.
Gold prices fell on the COMEX today due to higher-than-expected inflation, which has delayed expectations of interest rate cuts by the US Federal Reserve. On Tuesday, Fed Governor Lisa Cook mentioned that a rate cut would be appropriate at some point, but the timing remains uncertain. Fed Governor Bowman also expressed that she does not anticipate any rate cuts this year. Higher interest rates typically make non-interest-yielding bullion less attractive to investors.
Despite the short-term decline, long-term trends for gold remain bullish due to persistent geopolitical concerns, which are likely to support the metal’s price. Phillip Nova highlighted in a commentary that these concerns would limit any significant downside for gold. Investors are now awaiting the key US personal consumption expenditure price index data, expected on Friday. This data, as the Federal Reserve’s preferred inflation gauge, is likely to influence future rate decisions. At 0720 IST, the August gold contract on the COMEX was at $2,308.90 per ounce, down 0.2% from the previous close. 
