Copper prices hit their highest level in more than a month on Monday, following remarks by Donald Trump that the United States will not impose tariffs on its trading partners after taking office later that day.
Since the US election in November, the market has been focused on concerns about US import tariffs, especially given the possibility of a 60% levy on shipments from China, and the potential impact of trade wars on global trade and economic growth.
Benchmark copper on the London Metal Exchange (LME) rose 0.7% to $9,255 per tonne, after hitting a high of $9,297, its highest level since December 11.
Optimism that the Federal Reserve could accelerate the pace of interest rate cuts, boosted by data indicating a possible easing of inflationary pressures in the United States, also supported industrial metals.
“Inflation expectations in the US have changed. There is a market adjustment to the rate cut profile, and metal markets have automatically reacted to this,” said Tom Price, analyst at Panmure Liberum.
On trade policy, Price commented: “Trump is not yet a driver. However, if he re-implements significant tariffs as in 2018, demand for inflation-protecting assets will intensify, with gold and copper being the most attractive options.”
In other base metals, aluminium rose 0.4%, closing at $2,694 per tonne; zinc advanced 0.9%, to $2,969; lead rose 1.2%, reaching $1,991; tin also rose 1.2%, to $30,150; while nickel remained stable at $19,095.
Gold with few movements
Gold prices rose on Monday, supported by a weaker dollar. Spot gold rose 0.3% to $2,708.29 per ounce, while U.S. gold futures fell 0.7% to $2,729.20. The weak activity in futures was attributed to the Martin Luther King Jr. Day holiday, which kept U.S. markets closed.
“I expect the Donald Trump administration to generate more volatility in the markets, and some of its policies could prolong an environment of higher inflation. This will continue to favor safe haven assets such as gold,” said Giovanni Staunovo, an analyst at UBS.
Last week, gold hit its highest level since December 12, 2024. This rally was driven by core inflation data, dovish remarks from Federal Reserve Governor Christopher Waller, and reports of the gradual introduction of tariffs, leading markets to expect two rate cuts this year, instead of one as previously estimated.
As for other precious metals, spot silver rose 0.4%, closing at $30.46 per ounce.