Copper: Tariff risks keep prices vulnerable – ING

FXStreet Insights Team FXStreet

ING’s Commodities Strategist Ewa Manthey notes that Copper has dropped sharply after a Reuters report suggested a US decision on refined Copper tariffs is still pending, highlighting how a tariff premium has driven prices beyond fundamentals. She explains how US-focused arbitrage, shifting inventories and a still‑surplus refined market contrast with tight nearby supply, leaving Copper’s longer-term outlook positive but near-term prices sensitive to tariff headlines.

Tariff premium, stocks and surplus balance

"Copper fell more than 3% on Thursday after hitting a record $14,875/t on the London Metal Exchange earlier in the session."

"Until now, the market had largely assumed that tariffs would go ahead. The latest news has challenged that view and taken some of the tariff premium out of copper prices."

"If the tariff premium between New York and London narrows, shipping more metal to the US will become less attractive. Some stocks could eventually return to international markets."

"However, the refined market is not yet facing an outright shortage. Refined production rose 2.4% in the first half, leaving a preliminary surplus of around 131,000 tonnes, according to ICSG."

"Either way, the arbitrage will eventually close. If tariffs are ruled out, the US premium should narrow and some metal could return to international markets. If they go ahead, imports could rise again before the duties take effect, but should slow afterwards."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.