Copper prices (COPPER) fell to their lowest level since July, with LME prices briefly dropping around 1.5% to approximately $13,600 per tonne. At the same time, the market is beginning to price in weaker support from AI infrastructure investment and a lower probability of aggressive US trade policies, which had previously contributed to the US copper price premium.
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The Democrats taking control of Congress has reduced expectations for high tariffs on copper imports, weakening one of the key factors that had supported US copper prices.
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A smaller premium in the US market could encourage some supply to be redirected back to global markets, increasing metal availability outside the United States.
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Additional pressure is coming from the sell-off in technology stocks and growing concerns that the pace of investment in data centres and AI infrastructure could slow.
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Tighter financial conditions are also weighing on industrial metals, increasing pressure on the more cyclical segments of the commodities market.
At the same time, the physical market remains tight: copper premiums in China have risen above 2,500 yuan per tonne, reaching their highest level since the data series began in 2015. This creates a clear divergence between weaker macroeconomic and political sentiment and still-strong demand for physical metal, which could limit the scale of further declines.
COPPER Chart (H1 Timeframe)
Source: xStation5
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