Copper extended this year’s rally on a report the incoming Trump administration will slowly ramp up trade tariffs rather than impose sizeable levies in one go.
The report, based on unnamed sources, said the approach was aimed at boosting negotiating leverage and helping to avoid a spike in inflation, but the proposal is still in its early stages and hasn’t been shown to US President-elect Donald Trump yet.
It stirred some optimism in Asian stock markets and weighed on the US dollar, making commodities priced in the currency more attractive for many buyers.
Trump had floated the possibility of trade tariffs of 60% or higher on Chinese exports and levies of 10% to 20% on all imports during the presidential campaign. The prospect of gradual implementation is relatively positive for the metal, which has risen 4% this year after falling last quarter on a strengthening dollar and as China’s efforts to revive growth proved largely ineffective.
China will use a broad range of stimulus measures to offset the effects of expected US tariffs and a persistent housing downturn, Goldman Sachs Group chief economist Jan Hatzius told Bloomberg Television on Tuesday. Growth in the world’s top metal importer would likely slow to 4.5% this year from a probable 5% in 2024, he said.
Copper rose 0.5% to US$9,135 ($12,516) a tonne on the London Metal Exchange as of 11.26am in Shanghai. Zinc advanced 0.3%, aluminum added 0.2% and nickel fell 0.3%.
