FX.co ★ Copper Prices Retreat on Risk-Off Sentiment

Copper futures experienced a decline of over 1%, dropping to below $4.75 per pound on Tuesday. This downturn came after reaching four-week highs, as markets were dominated by risk aversion amidst ongoing global economic and trade uncertainties. Investors have adopted a more cautious approach ahead of the US Senate's deliberations on President Trump's extensive tax and spending bill, which is anticipated to substantially increase the national debt. Further compounding the uncertainty, Trump has postponed the imposition of a planned 50% tariff on European Union imports until July 9, shortly after initially declaring it would commence on June 1. Concurrently, China and the EU are intensifying their trade relations in response to escalating US protectionist measures, with negotiations scheduled to continue early next month. In terms of supply, the International Copper Study Group has recently doubled its prediction for a 2025 market surplus to nearly 300,000 tonnes, attributing this to strong ore production activity across South America.