Copper rebounds from 3-month low as tightness offsets tariff, AI fears
door
Copper prices rebounded on Wednesday from their weakest level in three months as initial fears about the impact of the US election on tariffs and AI data centres were offset by healthy demand and shortages outside the US.
Benchmark three-month copper on the London Metal Exchange rose 0.4% to $14,093 a metric ton in official open-outcry trading. It earlier fell as much as 1.5% to its lowest level since August 3.
The sharp losses were a knee-jerk reaction to the results of the US elections on Tuesday, in which Democrats seized control of both the Senate and House of Representatives, said Ole Hansen, head of commodity strategy at Saxo Bank.
"You could initially think that copper could be the one to be hurt the most since the market may lower its expectations for tariffs," he said.
"They may also focus on the AI trade given how data centres suddenly became such a big issue in the final part of the election."
The prospect of US tariffs on refined copper has spurred a large flow of metal to the US, creating shortages elsewhere and propping up prices, but any announcement that tariffs would not be imposed would free up that overhang and weigh on the market.
President Donald Trump has been a big supporter of the AI sector, which is expected to boost copper demand through its use in infrastructure, but opponents of data centres were among the biggest winners of the Democrats' landslide.
Copper prices were supported, however, by firm demand and shortages in top metals consumer China.
The Yangshan copper premium
Deel
