LONDON: Copper prices jumped to their highest in more than two months on Friday as investors became more optimistic about China after comments from US President Donald Trump about a possible deal with the world’s biggest metals consumer.
Three-month copper on the London Metal Exchange (LME) gained 0.4% to $9,270 a metric ton by 1700 GMT after touching its highest since Nov. 12 at $9,355.50. Trump said in an interview aired on Thursday evening that he would rather not have to impose tariffs on China and that a trade deal with the world’s second-largest economy was possible.
The comments, together with Trump calling for lower interest rates, helped to trigger a slide in the dollar index, putting it on track for the biggest weekly decline in more than a year.
A weaker US currency makes dollar-priced commodities less expensive for buyers using other currencies. Copper and other base metal prices may have only limited upside in the short term despite optimism in the market, said Carsten Menke, analyst at Julius Baer in Zurich.
“With Trump 2.0, I think it’s a bit more complicated, depending on how quickly opponents want to make concessions,” Menke said. “Our base case is that the tariffs are not about ramping up the US fiscal position or about fair trade, it’s really about achieving other goals.”
Trade data shows that US companies have stocked up on goods from China on fears they may become more expensive because of tariffs, Menke added. “So, in terms of industrial production in China, we could see a bit of a hangover in the first few months of this year.”
Nickel was in the red, dipping 0.2% to $15,630 a ton after Indonesia eased supply concerns by announcing a higher mining quota for 2025.
Among other metals, LME aluminium rose 0.5% to $2,637 a ton and tin gained 0.9% to $30,170 while zinc eased 0.7% to $2,828 and lead gave up 0.5% to $1,940.
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