Copper prices fell during Wednesday’s trading session despite a weaker US dollar against most major currencies, as the industrial metal came under pressure from warnings about a potential slowdown in artificial intelligence growth.

Analysts at Trafigura cautioned that global copper prices could face downside risks if the AI sector loses momentum following the sharp expansion seen in industries linked to the technology.

The warning comes at a time when a global copper shortage is reshaping both financial and industrial landscapes — and even the geopolitical one — as demand driven by clean energy transition and rapid technological progress continues to outpace supply growth.

With the expansion of renewable energy initiatives, the spread of electric vehicles, and the acceleration of global digital transformation, forecasts suggest that demand for refined copper could surge from around 27 million tons in 2024 to as much as 50 million tons by 2035.

According to estimates from the International Energy Agency and S&P Global, this growth reflects a broad structural imbalance between supply and demand that could trigger economic disruptions across multiple sectors.

Copper: An Indispensable Pillar of the Modern Economy

Copper’s exceptional conductivity and durability make it an irreplaceable component in energy systems, renewable power projects, and advanced electronics.

As climate policies tighten worldwide, copper’s role has evolved from a basic industrial commodity to a cornerstone of the global transition toward sustainability and clean energy.

The World Bank expects metal production — led by copper — to rise by nearly 500% by 2050 to meet ambitious climate goals.

Market analysts emphasize that investors should view the global copper shortage not as a temporary price cycle but as a long-term structural shift redefining how modern economies are built and operated.

Meanwhile, the US Dollar Index fell 0.3% to 98.7 points by 17:14 GMT, after reaching a high of 99.08 and a low of 98.6.

In trading, copper futures for December delivery declined by 0.4% to 5.00 dollars per pound as of 17:11 GMT.

Bitcoin steadied after a volatile session on Wednesday, as cryptocurrency markets found themselves caught between escalating trade tensions between the United States and China on one hand, and growing investor confidence that the Federal Reserve is nearing an interest rate cut in October on the other.

The world’s largest cryptocurrency slipped 0.2% to 112,292.5 dollars as of 1:30 a.m. Eastern Time (05:30 GMT), after falling to 109,000 dollars on Tuesday before recovering part of its losses.

Bitcoin Pressured by US–China Trade Tensions... Powell Provides Some Support

Renewed trade tensions between Washington and Beijing have been the main factor weighing on Bitcoin in recent sessions. The digital asset plunged sharply late last week to around 103,000 dollars before quickly rebounding from its lows.

Despite the rebound, Bitcoin remains below its recent all-time high of over 126,000 dollars.

At the same time, the crypto market found some support from dovish comments by Federal Reserve Chair Jerome Powell on Tuesday, as he hinted at a possible end to the central bank’s ongoing quantitative tightening program — remarks investors interpreted as a signal toward potential rate cuts.

Powell also noted rising uncertainty surrounding the US economic outlook, particularly amid the ongoing federal government shutdown.

These comments strengthened expectations for a rate cut at the upcoming late-October meeting, with data from the CME FedWatch Tool showing markets now pricing in a 99.6% probability of a 25-basis-point cut, up from 97.4% a week earlier.

Coinbase Invests in India’s CoinDCX at $2.5 Billion Valuation

In a notable development for the digital asset sector, Coinbase Global Inc (NASDAQ: COIN) announced on Tuesday that it had made an undisclosed investment in Indian cryptocurrency exchange CoinDCX, in a move aimed at expanding its presence in the Indian and Middle Eastern markets.

CoinDCX said in a separate statement that the new investment valued the company at roughly 2.45 billion dollars — a significant jump from earlier estimates of less than 1 billion dollars earlier this year. The company also noted that Coinbase has been an investor in CoinDCX since 2020.

Earlier reports suggested that Coinbase had shown interest in a full acquisition of CoinDCX. The US-based exchange recently obtained approval to offer its services in India but still trails rival Binance in terms of reach within the world’s largest crypto user base.

Recent data show that India leads the world in cryptocurrency adoption, with the number of digital asset holders surpassing 100 million by the end of 2024.

Oil prices fell on Wednesday as investors focused on the International Energy Agency’s forecast of a potential supply surplus by 2026, along with renewed trade tensions between the United States and China that could weigh on global crude demand.

Brent crude futures declined by 15 cents, or 0.2%, to 62.24 dollars a barrel at 10:47 GMT, while US West Texas Intermediate (WTI) crude futures fell by 6 cents, or 0.1%, to 58.64 dollars a barrel.

Both benchmarks had settled at their lowest levels in five months during the previous session.

Expectations of a Supply Surplus of Up to 4 Million Barrels Per Day

The International Energy Agency (IEA) said in a report on Tuesday that the global oil market could face a supply surplus of up to 4 million barrels per day next year — a level higher than its previous estimates — as the OPEC+ alliance and other producers increase output at a time when demand remains weak.

Emrel Jamil, senior oil analyst at LSEG, noted that “markets are currently focused on oversupply concerns amid mixed signals on demand,” adding that “waning geopolitical risks and rising trade tensions are adding further pressure on prices.”

US–China Trade Dispute Deepens Concerns

Trade tensions between the world’s two largest economies resurfaced last week after Washington and Beijing imposed additional tariffs on vessels transporting goods between them — a move expected to raise shipping costs, disrupt global trade flows, and potentially hinder global economic growth.

Giovanni Staunovo, oil analyst at UBS, said that “oil prices are currently being driven by the level of trade tension between the United States and China and by the overall market sentiment toward risk.”

Tensions escalated further after China announced last week new restrictions on rare earth metal exports, while US President Donald Trump threatened to impose 100% tariffs on Chinese goods and limit software exports to China starting November 1.

According to Yang An, an analyst at Haitong Futures, “the main factor determining the direction of oil prices in the coming period, alongside US–China trade relations, will be the scale of the supply surplus, which is reflected in changes in global inventory levels.”

Awaiting US Inventory Data to Gauge Domestic Demand

In terms of domestic demand, traders are awaiting weekly inventory data to assess consumption trends in the US market. A preliminary Reuters poll showed that US crude inventories rose by about 200,000 barrels during the week ending October 10, while gasoline and distillate stocks likely declined.

The American Petroleum Institute (API) is scheduled to release its weekly report at 4:30 p.m. Eastern Time (20:30 GMT) on Wednesday, followed by official data from the US Energy Information Administration (EIA) at 10:30 a.m. Eastern Time (14:30 GMT) on Thursday.

Both reports were delayed by one day due to the Columbus Day / Indigenous Peoples’ Day holiday observed on Monday.

The US dollar fell against a basket of major currencies on Wednesday after remarks by Federal Reserve Chairman Jerome Powell strengthened market expectations for a series of interest rate cuts over the coming months.

The Japanese yen and the Australian dollar emerged as the best-performing currencies of the day, both continuing to recover from the sharp declines they recorded against the greenback last week.

Analysts also pointed to additional support from Beijing’s decision to fix the official yuan exchange rate at a stronger level than the 7.1 per dollar line — the first time Chinese authorities have taken such a step since last November.

Despite rising trade tensions between the United States and China, including a new tariff dispute, the risk-sensitive Australian dollar continued to climb. The yen also strengthened, even amid growing uncertainty over Japan’s next prime minister, with local media reports suggesting that a parliamentary vote scheduled for next week could be delayed due to internal political disagreements.

Dollar Index Extends Losses for the Second Session

The dollar index — which measures the greenback’s performance against six major currencies — fell by 0.2% to 98.844 points as of 05:36 GMT, extending its 0.2% decline from the previous session.

In a speech on Tuesday, Jerome Powell kept the door open for potential rate cuts, noting that the US labor market remains mired in stagnation with low levels of hiring and layoffs. He added that the lack of official economic data caused by the government shutdown has not prevented monetary policymakers from assessing the outlook “at least for now.”

According to LSEG data, markets are currently pricing in a strong probability that the Federal Reserve will cut rates by 25 basis points at its October 28–29 meeting, followed by another cut in December and three additional cuts next year.

Analysts at DBS said markets are currently trading in a “Goldilocks mode” — a reference to an ideal balance between solid economic growth and accommodative monetary policy. They added that “trade tensions, the government shutdown, and inflation concerns are all being set aside for now.”

Comments from Washington and Beijing Ease Market Concerns

Remarks by Jamieson Greer, the US Trade Representative, helped calm markets on Tuesday after he told CNBC that President Donald Trump still plans to meet Chinese President Xi Jinping in an effort to reduce trade tensions between the two nations.

In currency markets, the dollar fell 0.4% to 151.23 yen after earlier touching a session low of 151.005 yen. It also slipped 0.2% to 7.1284 yuan in offshore trading.

The Australian dollar rose 0.4% to 0.6514 US dollars after falling 0.5% the previous day to its lowest level since August 22 at 0.64405 dollars.

Meanwhile, the New Zealand dollar edged up 0.1% to 0.5718 dollars after hitting a six-month low of 0.56839 dollars on Tuesday.

Paul Conway, chief economist at the Reserve Bank of New Zealand, told Bloomberg TV on Wednesday that policymakers stand ready to cut rates again if necessary, following a significant rate reduction last week.

Euro and Pound Supported by Domestic Developments

The euro rose 0.1% to 1.1621 dollars after gaining 0.3% in the previous session, supported by the French government’s proposal to suspend its controversial pension reforms — a move investors viewed positively for eurozone markets.

The British pound climbed 0.3% to 1.3355 dollars, rebounding from Tuesday’s losses after official data showed a slowdown in UK wage growth, prompting some traders to scale back bets on further monetary tightening from the Bank of England.