Copper slips after 10-week rally as Fed rate-hike bets rise

London copper was marginally lower on Monday after posting a 10th consecutive weekly gain supported by thin availability outside the US, as stronger-than-expected jobs data lifted expectations of a Federal Reserve rate hike.

Three-month copper on the London Metal Exchange fell 0.27% to $14,377 a metric ton by 0334 GMT, while the most-traded copper contract on the Shanghai Futures Exchange was flat at 109,110 yuan ($16,257.41) a ton.

US nonfarm payrolls increased by 162,000 in August, well above economists’ expectations of a gain of 56,000, while the unemployment rate held steady.

The data boosted expectations of a September Fed rate increase, though the dollar struggled to extend Friday’s gains in Asian trading on Monday.

Stronger jobs data and frequently shifting rate expectations have kept copper prices choppy, analysts at Chinese broker Galaxy Futures said in a note on Monday.

Concerns over another LME short squeeze have eased as the COMEX-LME price gap narrowed to just above $300 a ton and the share of cancelled LME warrants declined, although the continued pull of metal into the US could again leave short-position holders struggling to source metal for delivery, Galaxy Futures said.

Large volumes of copper have flowed into the US in anticipation of possible import tariffs, draining inventories elsewhere.

US copper imports hit a record high in July.

Meanwhile, inventories in warehouses monitored by the Shanghai Futures Exchange fell 13% last week to 63,000 tons, the lowest since January 2024.

LME copper stocks also declined by 475 tons as of Thursday.

Among other LME metals, aluminium slipped 0.03%, nickel fell 0.36%, while zinc and tin edged up 0.06% each and lead gained 0.29%.

On the SHFE, aluminium rose 0.06%, zinc gained 0.97% and lead advanced 0.74%, while nickel slipped 0.04% and tin eased 0.05%.