MARKET COMMENTARY
Three-month LME copper prices traded within a range of USD 13,103.5–13,934 per tonne during July. Despite significant volatility throughout the month, copper prices ended July at USD 13,803 per tonne, posting a 3.16% monthly gain.
Copper prices came under pressure at the start of the month as investors remained cautious amid uncertainty over potential U.S. tariffs on refined copper imports. In addition, escalating geopolitical tensions between the United States and Iran, together with Tehran’s announcement of another closure of the strategically important Strait of Hormuz, weighed on market sentiment and heightened risk aversion.
As the month progressed, weaker-than-expected U.S. inflation data strengthened expectations that the Federal Reserve might adopt a more dovish monetary policy stance. At the same time, growing concerns over global copper supply and continued declines in LME warehouse inventories provided additional support to prices.
Toward the end of July, market sentiment improved further after the Federal Reserve decided to keep interest rates unchanged. The resulting weakness in the U.S. dollar increased the attractiveness of dollar-denominated commodities, including copper. Meanwhile, strong physical buying from China reinforced the upward momentum in prices.
Overall, although the 3M LME copper market remained volatile throughout July due to geopolitical developments and trade policy uncertainty, stronger Chinese demand, tightening supply conditions, falling LME inventories, and a weaker U.S. dollar supported a late-month rally. Consequently, 3M LME copper closed the month at USD 13,803 per metric ton, representing a 3.16% increase compared with the previous month.
