Copper prices hit a record high on Wednesday, supported by sustained demand from speculative funds, although some investors cautioned that elevated price levels could begin to deter industrial buyers.

The benchmark three-month copper contract on the London Metal Exchange slipped 0.1% to $13,176.50 per metric ton by 10:30 GMT, after touching a record high of $13,407 earlier in the session.

Copper prices in London are up around 44% over the past 12 months, driven by mine supply disruptions, concerns over a supply deficit this year, and metal flows into the United States ahead of potential tariff measures, which have tightened availability in other regions.

Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen, said: “With all these concerns about currency debasement, financial risks, and Federal Reserve independence, demand for tangible assets has become very strong.”

He added: “In industrial metals, there is a level at which we reach a point where demand destruction begins. I don’t know exactly where that level is, or whether we’ve already reached it.”

Hansen noted that a close below $13,000 per ton could trigger a corrective downside move in the market.

Copper demand in China appeared stable, with potential stockpiling ahead of the Lunar New Year holiday, according to Hansen.

The most actively traded copper contract on the Shanghai Futures Exchange closed up 0.9% at 104,120 yuan ($14,931.88) per ton, after hitting a record high of 105,650 yuan.

Tin hits record highs

Tin prices in both Shanghai and London reached record levels, with gains of 24% in Shanghai and 30% in London since the start of January, as investors bet on rapid growth in demand for the metal used in semiconductor manufacturing, driven by the artificial intelligence boom.

The Shanghai tin contract jumped 8% to the daily price limit of 413,170 yuan, while tin on the London Metal Exchange rose 4.1% to $51,550 per ton.

Jing Xiao, an analyst at SDIC Futures, said: “We do not see any fundamental change in the tin market. The price surge is mainly being driven by speculative trading.”

Tom Langston of the International Tin Association shared the same view, noting that supply-demand fundamentals remain unchanged, while fund appetite on the London exchange has reached record levels.

Other metals performance

Aluminium on the LME: +0.1% to $3,200 per ton

Zinc: +1% to $3,232

Lead: +0.4% to $2,069

Nickel: +1.7% to $17,975 per ton

Bitcoin rose on Wednesday after Strategy, the world’s largest institutional holder of the cryptocurrency, announced a $1.3 billion Bitcoin purchase, although the token trimmed part of its gains as data showed continued weakness in retail investor demand.

The world’s largest cryptocurrency climbed 3.4% to $95,001.9 by 01:01 a.m. US East Coast time (06:01 GMT). Bitcoin had touched a nearly two-month high of $96,033.3 late on Tuesday.

Strategy buys $1.3 billion worth of Bitcoin in largest deal since July

Bitcoin’s gains were primarily driven by Strategy, led by Michael Saylor, which disclosed the purchase of 13,627 Bitcoins at an average price of $91,519 per coin, for a total value of $1.25 billion.

Following the transaction, Strategy’s total Bitcoin holdings rose to 687,410 coins, reinforcing its position as the largest publicly listed corporate holder of Bitcoin globally.

The purchase marked Strategy’s largest Bitcoin acquisition since July 2025 and was financed through the sale of common and preferred shares.

The deal helped ease concerns over a slowdown in Strategy’s Bitcoin accumulation, particularly after the company had purchased only limited amounts since mid-December.

However, Strategy’s shares have lost nearly 50% of their market value since the start of 2025, amid growing concerns over the long-term viability of its Bitcoin-centric strategy. This has prompted widespread selling of the stock, with additional pressure stemming from the ongoing decline in Bitcoin prices, raising fears that the company could be forced to sell part of its crypto holdings to meet debt obligations.

US retail demand for Bitcoin remains weak as Coinbase discount signals pressure

Retail demand for Bitcoin in the United States remained subdued, with the cryptocurrency trading on Coinbase Global at a discount to the global average price.

Bitcoin’s price on Coinbase is widely used as a gauge of US retail investor appetite, given the platform’s dominant share of the American market.

Data from Coinglass showed that Bitcoin continues to trade at a discount on Coinbase relative to global prices, pointing to persistent weakness in demand from individual investors.

The data also indicated that Bitcoin has been trading at a Coinbase discount since mid-December, coinciding with a broader downtrend in the token’s average price over the same period.

Cryptocurrency prices today: altcoins outperform Bitcoin

Other cryptocurrencies outperformed Bitcoin on Wednesday, partly supported by US inflation data for December that broadly matched expectations. Core consumer prices came in slightly below estimates but were in line with November’s reading.

However, the data were not sufficient to alter market expectations that the Federal Reserve will keep interest rates unchanged at its late-January meeting.

Ether, the world’s second-largest cryptocurrency, rose 6.1% to $3,325.22 after trimming some intraday gains, while XRP advanced by around 4%.

Oil prices rose for a fifth consecutive session on Wednesday, driven by concerns over potential disruptions to Iranian supplies amid the risk of a US military strike on Iran and possible retaliatory attacks targeting US interests across the region.

Brent crude futures climbed by 85 cents, or 1.3%, to $66.32 a barrel by 13:02 GMT, while US West Texas Intermediate crude rose by 80 cents, or 1.3%, to $61.95 a barrel.

Tehran warned US allies in the Middle East that it would target American bases on their territory if Washington launched an attack on Iran. In this context, some personnel were asked to leave a US military base in Qatar.

Jorge Montepeque, chief executive of Onyx Capital Group, said: “We are in a period of geopolitical instability and supply disruption risk.” He added: “The protests in Iran are being viewed as potentially leading to regime change, which would be a major development, and the probability of a US attack now appears elevated.”

US President Donald Trump on Tuesday urged Iranians to continue protesting, saying that help was on the way, without specifying the nature of that assistance.

Analysts at Citigroup said in a research note that “the protests in Iran carry risks of tightening global oil market balances, either through potential near-term supply losses or via a higher geopolitical risk premium,” adding that they had raised their three-month Brent forecast to $70 a barrel.

The analysts noted, however, that the protests have not spread to Iran’s main oil-producing regions so far, limiting their immediate impact on supply.

Oil’s gains were capped by large increases in US crude and fuel inventories, according to data from the American Petroleum Institute released late on Tuesday.

The API, citing market sources, said US crude inventories rose by 5.23 million barrels in the week ended January 9.

Gasoline inventories increased by 8.23 million barrels, while distillate stocks rose by 4.34 million barrels from the previous week.

Official inventory data from the US Energy Information Administration are due later on Wednesday. A Reuters poll conducted on Tuesday showed that US crude inventories were expected to have declined last week, while gasoline and distillate stocks were forecast to rise.

Further limiting price gains, Venezuela, a member of the Organization of the Petroleum Exporting Countries (OPEC), has begun rolling back production cuts imposed under US sanctions, alongside the resumption of crude exports, according to three sources.

Two very large crude carriers left Venezuelan waters on Monday, each loaded with around 1.8 million barrels of crude, in what may be the first shipments under a 50-million-barrel supply agreement between Caracas and Washington, aimed at reviving exports following the US seizure of Venezuelan President Nicolas Maduro.

The Japanese yen fell to its weakest level in a year and a half against the US dollar on Wednesday, amid speculation that a potential early election could pave the way for fresh fiscal stimulus, prompting traders to reassess the likelihood of official intervention to support the currency.

The yen slipped as much as 0.2% to 159.45 per dollar earlier in the session, its lowest level since July 2024, before paring losses in volatile trading. The dollar later fell 0.3% to 158.66 yen by mid-European trading.

The Japanese currency has continued to weaken against most major counterparts, from the euro to the Mexican peso, over recent months, as investor concerns mount over Prime Minister Sanae Takaichi’s plans for expansive fiscal spending. Those concerns are seen as intensifying if an election is called next month and delivers a comfortable parliamentary majority.

With the yen approaching the 160-per-dollar level, market participants are increasingly alert to the risk of intervention by Japanese authorities. Jeremy Stretch, head of G10 FX strategy at CIBC Capital Markets, said the issue is less about the absolute level of the yen and more about the speed of its moves.

Intense focus on dollar/yen

Stretch said: “Clearly, the focus is on dollar/yen, but it’s also important to monitor the broader yen complex, as some crosses have moved sharply — euro/yen, for example, has reached record levels.”

He added: “Dollar/yen remains the primary focal point, but it is not the whole story. At this stage, the market appears to be watching how far moves can extend before intervention is seen as imminent or plausible.”

Over the past two months alone, the yen has lost around 3% against the dollar. Ahead of previous intervention episodes, such as in April and July 2024, the currency had fallen by close to 6% over a similar timeframe.

Japan’s Finance Minister Satsuki Katayama issued a fresh verbal warning on Wednesday, stating that authorities would take “appropriate action against excessive moves in the foreign exchange market, without ruling out any options.”

Dollar steadies after inflation data

The dollar held near its highest level in a month against a basket of major currencies following the release of US consumer inflation data on Tuesday, which largely matched expectations. The figures reinforced bets that the Federal Reserve will keep interest rates unchanged at its upcoming meeting, despite unprecedented pressure from the White House to cut rates.

The dollar had dropped sharply on Monday after US President Donald Trump threatened to pursue criminal charges against Federal Reserve Chair Jerome Powell, before central bank governors and senior Wall Street executives lined up to back Powell on Tuesday.

Brian Martin, head of G3 economics at ANZ in London, said: “There is a loud chorus of politicians, former Fed chairs, and other officials stressing that Federal Reserve independence is sacrosanct and should not be undermined.”

Focus on Supreme Court tariff ruling

Investors are also closely watching the possibility of a ruling from the US Supreme Court on the legality of Trump’s emergency tariffs.

ING analysts wrote in a research note: “The court may uphold the tariffs, in which case the market will move on. We expect them to be struck down, but even then the market is likely to move on.”

They added: “US bond markets continue to show a remarkable ability to look through much of this noise.”

Against the offshore Chinese yuan traded in Hong Kong, the dollar was steady at 6.9752 after December trade data showed the world’s second-largest economy ended the year with a record surplus of nearly $1.2 trillion.

In other currency markets, the euro was steady at $1.1646, while sterling rose 0.2% to $1.3447.