Copper prices continue to trade near record highs despite mounting signs of a slowing global economy and weakening industrial activity. As of early June 2026, investors still view copper as one of the key metals tied to the future of electrification, renewable energy, and artificial intelligence infrastructure.

Although broader economic data point to slower growth and weaker manufacturing activity, the connection between copper and the artificial intelligence sector has become a major driver of market sentiment. The debate is no longer whether AI will increase copper demand in the future, but whether markets have already priced in that expected demand too aggressively.

Natalie Scott-Gray, Senior Metals Analyst at StoneX, who has more than a decade of experience analyzing global metals markets, supply chains, and industrial commodity demand, believes that understanding copper’s recent price action requires examining the interaction between market fundamentals, investor behavior, geopolitical developments, and the growing influence of artificial intelligence.

Scott-Gray said copper prices have become increasingly sensitive to movements in US technology stocks, noting that the correlation between copper and technology equities has reached historically unprecedented levels. She added that any shift in investor sentiment toward artificial intelligence, earnings expectations, or technology company valuations can directly affect copper markets and amplify price volatility.

Despite the excitement surrounding artificial intelligence, Scott-Gray pointed out that actual copper demand generated by data centers and AI-related infrastructure remains relatively limited compared to what many investors assume.

She emphasized that demand linked to artificial intelligence and data centers currently accounts for less than 2% of total copper demand, highlighting a significant gap between market expectations and present-day consumption realities.

According to Scott-Gray, investors may be overestimating the speed at which AI-related demand will grow, creating the risk of price corrections whenever market enthusiasm becomes disconnected from underlying fundamentals.

Nevertheless, the long-term outlook for copper remains positive, supported by electrification trends and large-scale investments in infrastructure and energy systems. However, artificial intelligence alone has not yet become the primary driver of actual copper demand.

Scott-Gray warned that market sentiment has moved far ahead of reality, explaining that investors are increasingly linking the narrative of a future structural copper deficit with elevated expectations surrounding artificial intelligence, attracting additional speculative capital into the market.

She added that this dynamic is creating larger price swings and increasing sensitivity to daily news and developments, potentially opening the door to sharp corrections even while the long-term bullish trend remains supported by strong underlying fundamentals.

Bitcoin is standing at a critical crossroads after a sharp selloff pushed the digital asset back toward one of the most important support zones of the current market cycle, as investors continue to monitor developments in the Middle East and await signals from the Federal Reserve.

Bitcoin fell to $59,100 on June 5, a level that has historically served either as a major floor for previous declines or as a gateway to much deeper losses.

Federal Reserve meeting

Expectations increasingly point toward further monetary tightening by the Federal Reserve later this year. Analysts now anticipate that the Federal Open Market Committee could deliver two additional 25-basis-point rate hikes before year-end in response to higher energy prices and continued strength in the US labor market.

Even before the latest jobs report, investors had been raising their expectations for higher interest rates amid concerns that the energy crisis linked to the conflict with Iran could intensify inflationary pressures.

Weekly data released by US regulators showed that investors cut their bullish euro positions to the lowest level in three months during the week ended June 4, while bearish positions against the Japanese yen exceeded $10 billion, according to LSEG data.

The Federal Open Market Committee is scheduled to meet next week in its first gathering under Chair Kevin Warsh. Markets currently see roughly a 50% chance of a rate hike by September, a factor that analysts say could limit excessive dollar buying in the near term.

Strategists at Barclays noted that several upcoming developments, including shifts in risk sentiment, the possibility of a US-Iran agreement, and the upcoming Federal Reserve meeting, could place limits on further dollar strength in the short run.

Middle East developments

In a fresh development in the Middle East, Israel announced that it carried out strikes against military targets in western and central Iran on Monday, despite reports suggesting that US President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to refrain from launching additional attacks.

The escalation pushed oil prices up by around 5%, adding to investor concerns at a time when markets were already facing a sharp correction in highly valued technology stocks.

At the time of writing, Bitcoin had recovered to $61,966. However, the rebound has not resolved the key question facing the market: is Bitcoin forming a major bottom, or is the current move merely a temporary pause before another leg lower?

The 200-week exponential moving average remains one of the most closely watched long-term indicators among Bitcoin traders. Analyst Michael van de Poppe noted that Bitcoin has formed major bottoms near this level in most previous bear-market cycles, with 2022 being the most notable exception.

According to analyst Dan Crypto Trades, the current decline ranks among the deepest pullbacks of its kind in Bitcoin’s history, making the present market structure particularly difficult to interpret. The current price zone is attractive enough to draw buyers, but the intensity of the selling pressure means a rapid recovery cannot be taken for granted.

The analyst added an important technical observation, noting that in previous instances where Bitcoin lost major support levels, prices typically accelerated lower and remained below those levels for extended periods.

This time, however, Bitcoin has managed to remain near its previous low, at least for now, opening the door to a different market structure. If buyers continue defending this area, Bitcoin could begin forming a broad trading range between approximately $60,000 and $80,000.

While such a range would not immediately confirm a bullish reversal, it would suggest that sellers are struggling to push the market into a deeper breakdown.

Oil prices surged by more than 4% on Monday after fresh Israeli strikes on Iran and renewed attacks in Lebanon undermined hopes that the broader regional conflict could soon come to an end.

During trading, Brent crude futures rose by $4.02, or 4.3%, to $97.11 per barrel by 09:14 GMT, while US West Texas Intermediate crude futures gained $3.90, or 4.3%, to reach $94.44 per barrel.

Middle East developments

Israel said on Monday that it had targeted the Mahshahr petrochemical complex in southwestern Iran, along with other military targets, despite reports indicating that US President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to refrain from carrying out additional attacks.

Iran’s semi-official Fars News Agency quoted a local official as saying that parts of the facility had sustained damage.

Giovanni Staunovo, an analyst at UBS, said that the exchange of strikes between Iran and Israel is increasing market concerns that restrictions on shipping through the Strait of Hormuz could remain in place for a longer period, pushing oil prices higher.

Roughly one-fifth of global daily oil and liquefied natural gas supplies pass through the Strait of Hormuz off the coast of Iran.

Later on Monday, comments attributed to Iran’s ambassador to Moscow indicated that the strait would remain open, but under new conditions to be determined by Iran and Oman, including the imposition of transit fees.

Monday’s gains erased the losses oil prices suffered on Friday, when they fell on hopes that tensions between the United States and Iran might ease.

Since the outbreak of the conflict a little over 100 days ago, Brent crude has climbed 34%, while West Texas Intermediate has surged 41%. Brent prices had approached $120 per barrel in March.

On Sunday, Iran launched a new wave of missiles at Israeli targets in response to strikes carried out in Lebanon.

Despite the escalation, US President Donald Trump maintained that a broader agreement to end the conflict remains highly achievable.

Iran has made a ceasefire in Lebanon a condition for any peace agreement with Washington. Lebanon and Israel announced a ceasefire agreement on June 3 following negotiations held in Washington.

OPEC+

Amid the supply disruptions caused by the conflict, the OPEC+ alliance approved its fourth increase in oil production targets in four months on Sunday.

Analysts said the decision is unlikely to have a major impact because many alliance members are already unable to reach their production targets, either due to disruptions linked to the Strait of Hormuz closure or, in Russia’s case, because Ukrainian drone attacks have weakened production capacity.

Jorge Leon, Head of Geopolitical Analysis at Rystad Energy, said the practical impact of such a decision under current market conditions would be close to zero.

He added that refineries around the world have rushed to secure crude oil from any available source to replace the millions of barrels per day that are no longer flowing through the strait, noting that the world has lost more than one billion barrels of supply since the conflict began.

The US dollar traded near its highest level in almost two months on Monday after a strong US employment report prompted investors to increase bets that the Federal Reserve will raise interest rates later this year, while the Japanese yen continued to drift toward levels that could trigger official intervention in the foreign exchange market.

Currency market moves were relatively calm compared to the turbulence seen across global financial markets, where a sharp selloff in technology stocks spread across Asia and weighed on European equities.

The dollar maintained the gains recorded after Friday’s employment report, which showed that US nonfarm payrolls increased by 172,000 jobs last month, significantly exceeding market expectations. The euro remained close to a nine-week low at $1.1525, while the British pound traded near a three-week low at $1.3344.

Jonas Goltermann, Chief Markets Economist at Capital Economics, said the US jobs report paints a picture of a labor market that continues to strengthen despite the ongoing energy price shock.

Federal Reserve meeting

He added that this combination makes further monetary tightening by the Federal Reserve later this year more likely, noting that Capital Economics now expects the Federal Open Market Committee to deliver two additional 25-basis-point rate hikes this year in response to higher energy costs and continued strength in the US labor market.

Even before the jobs report was released, investors had already been increasing expectations for higher interest rates as the global energy crisis linked to the conflict with Iran continued to fuel inflation concerns.

Weekly data from US regulators showed that investors cut their bullish euro positions to the lowest level in three months during the week ended June 4, while bearish bets against the Japanese yen increased to more than $10 billion, according to LSEG data.

The Federal Open Market Committee is scheduled to meet next week in its first gathering under Chair Kevin Warsh. Markets are currently pricing in roughly a 50% chance of a rate hike by September, which analysts say could limit excessive dollar buying in the near term.

Strategists at Barclays said upcoming factors, including shifts in risk appetite, the possibility of a US-Iran agreement, and the upcoming Federal Reserve meeting, may cap further dollar gains in the short term.

Middle East developments

In a new development in the Middle East, Israel announced that it carried out strikes against military targets in western and central Iran on Monday, despite reports that US President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to refrain from launching additional attacks.

The developments pushed oil prices up about 5%, adding further concerns for investors already dealing with a sharp selloff in highly valued technology stocks.

Over the past two weeks, the dollar has benefited from its safe-haven status, in addition to expectations of a widening interest rate gap between the United States and other major economies, a factor that has particularly pressured the Japanese yen.

Japanese yen

The yen has now surrendered the gains achieved after Tokyo intervened in the currency market with approximately ¥11.7 trillion, equivalent to about $73 billion, a little more than a month ago, when the currency fell to its weakest level since July 2024 at ¥160.725 per dollar. The Japanese currency traded near ¥160.19 on Monday.

Reuters sources indicated that the Bank of Japan is expected to raise interest rates this month unless a major escalation in the Middle East conflict causes severe market disruption, while higher fuel costs resulting from the energy shock continue to increase inflationary pressures on the Japanese economy.

Sim Moh Siong, Market Strategist at OCBC, said this leaves the yen in a wait-and-see position because markets have already almost fully priced in a rate hike.

He added that any additional support for the yen from rate hike expectations will depend on whether the Bank of Japan signals a faster-than-expected pace of future interest rate increases.