Copper’s rally cooled on Monday as weaker economic data from China and elevated global inflation pressures weighed on the metal’s demand outlook.
Benchmark copper on the London Metal Exchange (LME) fell as much as 1.6% to around US$14,343 ($20,424) a tonne, its lowest level since 17 September.
The decline came after new data showed industrial profit growth slowing in China, the world’s largest consumer of copper.
Earnings at industrial enterprises rose 4.2% year-on-year in August, down from an 11% increase in July, as weak domestic demand offset strength in technology manufacturing.
“The key data point weighing on sentiment is China’s August industrial enterprise profits,” Britannia Global Markets says in a note.
Economy weighs on demand
According to the UK-based brokerage, the latest figures underscore that “the recovery remains narrow and concentrated” in AI-linked and export sectors rather than across the broader industrial economy.
“For base metals, this matters as it signals that downstream manufacturing appetite remains constrained,” it adds.
Trading activity is also expected to slow ahead of China’s week-long National Day holiday, which runs from 1–7 October.
Meanwhile, elevated oil prices have added to concerns over the global economic outlook as the US-Iran conflict continues.
Higher energy costs are adding to inflationary pressures, potentially creating another headwind for economic growth and demand for industrial metals.
Copper market remains tight
Despite weaker demand sentiment, copper availability remains a concern, with inventories across LME-registered warehouses sitting near a one-week low.
Cash copper is again trading at a premium to three-month contracts — a sign of tight near-term supply.
That premium briefly moved into a discount earlier this month after a Reuters report raised doubts over whether the Trump administration would extend tariffs to refined copper imports.
The White House has yet to make a final decision, with officials weighing the potential benefits of supporting domestic production against the higher costs tariffs could impose on US manufacturers.
Before the report, expectations of tariffs on refined copper had encouraged traders and buyers to move metal into the US, tightening supplies elsewhere and helping drive copper prices to record highs.
Write to Jackson Chen at Mining.com.au
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