Copper Falls on Soft China Demand

Copper futures fell about 1% to below $4.85 per pound on Tuesday, reversing gains from the previous session as weak industrial demand from top consumer China weighed on import volumes.

Recent data also pointed to persistent deflationary pressure in China, as well as softer-than-expected export growth caused by the ongoing trade war with the US. Investors are closely watching trade negotiations between US and Chinese officials in London, where discussions began Monday over rare earth shipments and the possible easing of export restrictions.

Additional talks are expected to continue Tuesday.

Despite the short-term dip, copper inventories at London Metal Exchange warehouses remain on a downward trend, indicating steady demand from global manufacturing hubs.

However, analysts warn that elevated prices could start to suppress consumption, increasing the likelihood of a near-term correction in the market.