Copper prices fell on Tuesday as investors shun the markets amid uncertainty on the US-China trade talks and the impact of the ongoing trade war on global growth and demand on metals. 

Three-month copper futures fell 0.3% at the London Metals Exchange to $9767 a ton, after recovering 20% from November 2023 lows plumbed in April.

High-level talks between US and Chinese officials commenced this week in London, with the hopes of reaching some sort of an initial agreement on tariffs and trade.

Copper inventories at the London exchange fell by 2000 tons to 120,400 tons, after falling by half in the past three months. 

Copper futures at the US COMEX Exchange fell 0.8% to $4.89 a pound, with the US premium over London standing at $1000 a ton.

Traders are waiting for the investigation order by Trump in February on potential tariffs on copper imports, which could shake up prices.

In China, zinc prices fell at the Shanghai exchange by 1.3% to $21,845 yuan a ton, an April low.

Aluminum prices fell 0.1% at the London Exchange to $2477 a ton, while nickel fell 0.7% to $15,310, as lead fell 0.4% to $1978, while tin slipped 0.1% to $32,750 a ton.

Otherwise, the dollar index fell to 98.9 as of 15:25 GMT, with a session-high at 99.3, and a low at 98.8.

On trading, copper July futures fell 0.4% as of 15:23 GMT to $4.90 a pound. 

Bitcoin gained ground on Tuesday but tapered off after surpassing $110,000, with the price hovering above $109,000 while total crypto market value reached $3.38 trillion.

The rise comes one week before the crucial Fed’s meeting on June 18.

The price could be swayed soon by the US consumer price index, which is likely under pressure due to Trump’s tariffs.

Consumer prices are expected up 0.3% m/m and 2.3% y/y, while core prices are expected up 2.9% y/y.

Higher inflation would reduce the odds of future Fed rate cuts, in turn hurting the crypto industry. 

Analysts are mixed on the outlook of bitcoin, with some expecting a sharp correction towards $95,000, while others believe bulls remain in control with the price heading towards the $140,000-$150,000 range.

Technical Signals Hint at $140,000

Multiple technical signals and indicators likely pave the way towards a solid breach of the $112,000 recent record high, with a solid target at $143,000, representing a 35% profit. 

Traders are also on edge as the US conducts trade talks with China in London, which could have an impact on the crypto industry.

The previous talks in Geneva led both sides to suspend most tariffs for 90 days, underpinning the S&P 500 and the crypto markets.

But tensions have brewed once again since then with both sides accusing the other of violating the deal and restructuring critical minerals and products unfairly. 

Global Corporations Buy up Bitcoin 

Strategy’s Chairman Micheal Salyor hinted on the X platform at new upcoming bitcoin purchases under a new plan for the company’s wallet.

From Japan, MetaPlanet issued 555 million shares with the target of collecting $5.4 billion to buy more bitcoins, aiming at gathering 210,000 bitcoins overall by 2027, thus sending the company’s share over 15% higher.

The US dollar stabilized on Tuesday as Beijing and Washington negotiate on trade for the second day in London, boosting hopes, while sterling fell after weak UK labor data. 

High-level talks between US and Chinese officials commenced this week in London, with the hopes of reaching some sort of an initial agreement on tariffs and trade.

It comes after the Trump-Xi phone call which was described as “very positive” and paved the way for deeper communication. 

Trump adviser Kevin Hassett said that reducing US chip exports restrictions could be discussed, and in return, China would accelerate shipments of rare-earth minerals. 

Dollar’s Performance 

The dollar index rose 0.1% against a basket of major rivals to 98.989, hovering near a six-week trough at 98.351.

The index fell 8.7% since the start of the year amid concerns among investors about the impact of tariffs on the US economy. 

The euro stabilized at $1.1423, while sterling edged down 0.1% to $0.6513.

Sterling lost ground after weak UK jobs data, boosting the odds of future Bank of England rate cuts.

UK wages rose 5.2% in the three months ending April, below estimates, sending the pound down 0.4% against the dollar to $1.13488.

The BOE will convene next week and is still expected to maintain interest rates unchanged, with traders expecting 48 basis points of rate cuts overall by the end of the year.

Japan to Maintain Rates

The Bank of Japan is also widely expected to maintain interest rates unchanged at next week’s meeting, with the governor Kazuo Ueda noting that the timing of the next rate hike might be delayed.

Ueda said ahead of the Parliament that the bank remains committed to policy normalization and rate hikes as long as inflation remains near the 2% target.

Yen has settled at 144.50 after surging 8.5% against the US dollar this year, boosted by haven demand after Trump’s tariffs.

Now investors await the crucial US consumer prices report for May, which will impact the future path of Fed’s interest rates this year.

Silver prices fell in European trade on Tuesday for the first time in four days, backing away from 13-year highs on profit-taking, under pressure from the stronger dollar.

The decline comes after signals about progress in the US-China trade talks in London, which entered its second day.

Prices

Silver prices fell 1.2% today to $36.31 an ounce, with a session-high at $36.83.

On Monday, silver rose 2.2%, the third profit in a row, scaling a 13-year peak at $36.89.

A Surge

Silver prices rallied over 10% in June so far on strong industrial demand on the white metal, and improving retail demand as well, as silver remains far undervalued compared to the record-breakin gold.

US Dollar

The US dollar rose 0.4% on Tuesday and approached a one-week high against a basket of major rivals at 99.39.

It comes amid concerns about an economic slowdown in the US and China receded with both sides conducting important talks in London for a second day.