Copper Prices Drop Over 1% Following Fed's Signal for Fewer Rate Cuts

Copper prices fell by over 1% after the Federal Reserve signaled that fewer interest rate cuts will occur next year. The Fed's shift to a more hawkish stance led to an increase in bond yields, a rise in the dollar to a 25-month high, and a spike in volatility. This shift also resulted in a sharp decline in major commodity currencies. Market participants are concerned that there is little to stop this downward trend in the annual calendar. The three-month London Metal Exchange (LME) copper contract is trading at $8,912 per ton, down 1.5%. In addition to the Federal Reserve's stance, uncertainties regarding potential tariffs on Chinese goods and China's domestic demand outlook continue to weigh on the market.