On July 3rd, the main contract of Shanghai copper futures, 2508, opened higher and fluctuated, with the gains on the market narrowing. As of 10:15, the stoppage quote was 80,660 yuan per ton, up 40 yuan, or 0.05%. The atmosphere of chasing high prices in the spot market is relatively weak. The rising fear of high prices in the downstream market has put pressure on the premium. However, the interweaving of expectations for interest rate cuts and risk aversion at the macro level still provides key support for copper prices.
Data from the Yangtze Nonferrous Metals Network shows that the spot price of No. 1 copper on the Yangtze River is reported at 81,080 yuan per ton, up 30 yuan per ton from yesterday. The spot premium is 220 yuan per ton, down 30 yuan per ton from yesterday.
The ADP employment report for June in the United States released on July 2nd showed that private sector jobs decreased by 33,000, far below the market expectation of an increase of 95,000, marking the largest decline since March 2023. After the data was released, the market's probability of the Federal Reserve cutting interest rates by 25 basis points in September jumped from 85% to 92.5%, and the expectation of a rate cut in July also rose from 20% to 23%. The US dollar index came under pressure and declined, providing support for copper prices. However, Federal Reserve Chair Powell reaffirmed that interest rate cuts would be "highly dependent on data", and the policy path remains uncertain.
