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Copper Falls as Hot US Inflation Boosts Fed Rate Hike Bets
Copper prices declined as stronger than expected US inflation data increased expectations of a Federal Reserve rate hike, strengthening the dollar and weighing on metals and risk assets. Easing spot market tightness also added pressure, while traders remained cautious after copper reached a record high last week.
By Finblage Editorial Desk
2:14 pm
14 September 2026
Copper prices edged lower on Monday as hotter than expected US inflation data prompted traders to increase bets on a potential Federal Reserve interest rate hike at the central bank’s upcoming meeting.
London Metal Exchange copper futures fell as much as 0.6 percent after recording their first weekly decline since June. Most other major industrial metals also traded lower, pressured by a stronger US dollar and broader weakness across risk assets.
Traders increased expectations for tighter US monetary policy following Friday’s inflation data. Higher interest rates generally weigh on non yielding assets such as metals by increasing the relative attractiveness of interest bearing investments.
Signs of easing supply tightness in the copper market also contributed to the cautious sentiment. The premium for spot copper over three month futures stood at $4.50 a ton on Monday, having narrowed sharply in recent weeks. The decline in the premium suggests that immediate supply constraints have eased.
Analysts at Sucden Financial said copper could remain volatile around current levels as speculative positioning has declined while prompt market tightness has also eased. They said the metal could require stronger dip buying or a fresh macroeconomic or fundamental catalyst to establish a clearer direction.
Copper had rallied to a record high last week amid expectations that the US could impose tariffs on refined copper. The prospect of higher domestic prices encouraged traders to move metal toward the US market ahead of any potential tariff measures.
The broader bullish outlook for copper has also been supported by expectations of rising demand from data centers and renewable energy projects, along with supply disruptions at major copper mines. These factors have helped underpin prices despite renewed pressure from the macroeconomic environment.
On Monday, copper on the London Metal Exchange declined 0.3 percent to $14,193 a ton by 10:05 a.m. Singapore time. Zinc fell 0.7 percent, while aluminum was little changed. Iron ore declined for a fourth consecutive session, falling 0.4 percent to $97 a ton.
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