Copper Prices Rise in London Amid Hopes of U.S. Rate Cut, Despite Strong Dollar and Chinese Demand Concerns

Copper prices in London edged higher on Thursday, buoyed by market optimism over a potential U.S. interest rate cut in September, despite a strong U.S. dollar and ongoing concerns about weak Chinese demand. The London Metal Exchange (LME) expressed satisfaction with the rise in copper prices, although the gains were somewhat limited by these broader market concerns.

As of 0728 GMT, three-month copper futures on the LME increased by 0.3% to $9,287 per ton, reversing earlier losses. This modest gain came as traders reacted positively to Federal Reserve Chairman Jerome Powell’s signals that a rate cut could be on the horizon, which bolstered market sentiment.

Meanwhile, in China, the most actively traded October copper futures on the Shanghai Futures Exchange fell by 1.1% to 74,200 yuan ($10,434.68) per ton, reflecting the pessimistic outlook on the Chinese economy. A Chinese trader noted that without signs of a robust recovery in China's economy, market sentiment remains unoptimistic.

BHP Billiton, the world’s largest miner, announced earlier in the week that it would lower its forecast for copper demand growth in China this year to 1%-2%, further weighing on market sentiment.

In other metals, LME aluminum dipped 0.6% to $2,480.50 per ton, while nickel inched up by 0.1% to $17,040 per ton. Zinc saw a slight increase of 0.4% to $2,893 per ton, while lead dropped by 0.7% to $2,071.50 per ton. Tin fell marginally by 0.1% to $32,585 per ton.