Senior officials in the metals industry revealed that China intends to increase its national copper reserves, a move expected to further push copper prices higher and underscore global efforts to strengthen supply security. Boosted by this announcement, London copper prices briefly rose by 4.6%, with related remarks delivered at the annual industry development assessment meeting of the China Nonferrous Metals Industry Association.
The metals market has been highly volatile. Last Thursday, speculative buying drove Shanghai and London copper futures to record highs, followed by a sharp sell-off triggered by developments in Federal Reserve leadership and a collapse in precious metals. The latest rally continues this wave of fluctuations.
On monetary policy, dovish officials such as Milan called for significant rate cuts this year, arguing that the U.S. economy shows no strong inflationary pressures. In contrast, Richmond Fed President Barkin emphasized that controlling inflation remains the core objective, noting risks in the economic outlook, concentrated job growth in a few sectors, and resilience supported by AI infrastructure investment and consumer spending, while inflation remains above long-term targets. Internal divisions within the Fed have intensified ahead of the nomination of Chairman Walsh.
In the political sphere, the U.S. government resumed operations after a brief shutdown, with President Trump signing a funding agreement reached with Democrats. The bill, originally intended to provide resources for destroyers, had faced Democratic opposition. Meanwhile, U.S.–Iran tensions remain frequent, with an Iranian drone shot down by a U.S. aircraft carrier. Heightened geopolitical risks continue to fuel global safe-haven demand, driving sharp rebounds in gold and silver and linking them to broader metals market movements. The U.S. dollar remains weak, lifting the valuation base for metals.
On the industrial front, the European Union is considering stronger trade sanctions against Russia, potentially banning imports of Russian platinum group metals and copper. If approved by member states, iridium, rhodium, platinum, and copper from Russia would be restricted. In addition, strong fundamentals and bargain buying have supported copper’s rebound, with China’s reserve expansion further boosting market sentiment.
Overall, fundamentals show that overseas mine restarts remain sluggish, inventories outside the U.S. are low, and domestic stockpiling has slowed. These factors suggest copper prices may experience a sharp rally in the short term.