This LME Copper Prices Weekly Report highlights a mixed performance in global copper markets on Friday, as investors assessed the likelihood of U.S. interest rate cuts next year alongside rising concerns about the sustainability of the artificial intelligence (AI) investment boom. After reaching record highs last week, copper prices showed signs of consolidation across major exchanges.
LME and SHFE Copper Prices: Weekly Performance Comparison
According to this LME Copper Prices Weekly Report, the benchmark three-month copper contract on the London Metal Exchange (LME) slipped slightly by 0.12% to $11,764 per metric ton. Despite the minor dip, LME copper was on track to end the week 2.13% higher, supported by macroeconomic optimism and long-term demand expectations.
Meanwhile, on the Shanghai Futures Exchange (SHFE), the most-active copper contract traded nearly flat at 92,770 yuan ($13,175.87) per metric ton. However, SHFE copper was poised to close the week 1.03% lower, reflecting cautious sentiment among Asian traders.
Record Highs Trigger Profit Booking in Copper Market
The pullback highlighted in this LME Copper Prices Weekly Report follows last week’s strong rally, when Shanghai copper surged to a record 94,030 yuan, and LME copper climbed to an all-time high of $11,952 per ton. These historic price levels encouraged profit-taking, particularly as traders reassessed short-term fundamentals.
U.S. Inflation Data Supports Rate Cut Expectations
A key bullish factor discussed in this LME Copper Prices Weekly Report is easing inflation in the United States. Data released on Thursday showed U.S. consumer prices rose at a slower pace than expected in November, strengthening market expectations that the Federal Reserve may begin cutting interest rates in 2025.
Lower interest rates generally support industrial metals like copper, as borrowing costs decline and the U.S. dollar weakens, making commodities more attractive to global buyers.
Federal Reserve Remains Cautious Despite Recent Rate Cut
Although the Federal Reserve delivered a 25-basis-point rate cut last week, policymakers signalled that further reductions may not come immediately. The Fed cited uncertainty in economic data, partly due to disruptions caused by the government shutdown. This cautious stance has limited aggressive upside moves in copper prices, as reflected in this LME Copper Prices Weekly Report.
AI Sector Uncertainty Weighs on Copper Sentiment
Copper demand is closely linked to data centres, power infrastructure, and advanced computing, making the metal a critical component of the AI boom. However, this LME Copper Prices Weekly Report notes growing scepticism around AI-related investments after a recent tech stock sell-off.
Concerns intensified after reports that Blue Owl Capital stepped away from a planned $10 billion data centre project with Oracle, citing rising debt and capital expenditure pressures. This development raised questions about whether AI-driven copper demand can sustain its current momentum.
Nickel Prices Rise on Indonesia Supply Concerns
While copper prices moved sideways, nickel prices strengthened sharply. On the SHFE, nickel jumped 2.61%, while LME nickel gained nearly 1%. The rally followed comments from Indonesia’s mining association that the government plans to reduce annual nickel ore production to around 250 million tons.
Nickel is widely used in stainless steel and electric vehicle batteries, keeping long-term demand prospects firm.
Other Base Metals Show Mixed Trends
Among other base metals in Shanghai, aluminium rose 0.27%, lead gained 0.68%, tin added 1.35%, and zinc remained flat. On the LME, aluminium edged up 0.09%, zinc climbed 0.11%, lead advanced 0.61%, while tin traded flat, indicating cautious but stable market sentiment.
LME Copper Prices Weekly Report: Outlook
This LME Copper Prices Weekly Report suggests that copper prices may remain volatile in the near term, influenced by monetary policy signals, AI sector developments, and global supply dynamics. While long-term fundamentals remain supportive, short-term price movements are likely to stay range-bound as investors digest mixed economic cues.
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