Copper prices fell on Wednesday to their lowest level in nearly two weeks as investment funds moved to sell, while consumers and producers remained cautious ahead of Federal Reserve Chair Jerome Powell’s highly anticipated speech later this week, according to metals traders.

Commodity and financial markets are awaiting signals from Powell’s remarks on Friday regarding whether the Fed will cut interest rates by 25 basis points at its September 16–17 meeting, a move that could weigh on the dollar. A weaker US currency typically boosts demand for dollar-denominated metals, a dynamic fund managers are exploiting in daily trading strategies that rely on algorithmic signals.

Benchmark copper on the London Metal Exchange slipped 0.1% to $9,676 per metric ton by 10:23 GMT, after earlier touching $9,673.50, its lowest since August 7. Alistair Munro, senior base metals strategist at Marex, noted that “systematic flows are dominating the market in the absence of broader participation,” adding that expectations remain uncertain with the market struggling to gain direction.

Longer-term concerns over demand, particularly from China — the world’s largest copper consumer — have widened the discount between spot copper and the three-month contract to around $100 per ton, the highest since February. Weak appetite is also reflected in the Yangshan copper premium, a key gauge of China’s import demand, which has fallen to $47 per ton compared with levels above $100 in May. Technically, upward resistance is seen around $9,475 per ton, where the 21- and 50-day moving averages converge.

Traders also reported fund selling in aluminum, which briefly broke below its 200-day moving average at $2,565 per ton. Three-month aluminum earlier touched a two-week low at $2,558 before recovering 0.2% to $2,569.

Among other metals, zinc rose 0.2% to $2,773, while lead fell 0.3% to $1,967, tin slipped 0.2% to $33,780, and nickel dropped 0.5% to $14,935 per ton.

Bitcoin extended its losses to hit a two-week low on Wednesday, as investors cut positions ahead of the Federal Reserve’s Jackson Hole symposium and weighed geopolitical risks linked to potential talks between Russia and Ukraine.

The world’s largest cryptocurrency fell 1.1% to $113,728.5 by 2:03 a.m. Eastern Time (06:03 GMT). It was near a six-week low after dropping to $112,668 earlier in the session.

Bitcoin had climbed above a record $124,000 last week, but fell sharply after strong US economic data reduced bets on a major interest rate cut next month.

Jackson Hole Symposium and Possible Russia-Ukraine Talks

Markets are now focused on the Fed’s annual Jackson Hole symposium, where Chair Jerome Powell is scheduled to speak on Friday.

A decisively hawkish tone or guidance contradicting expectations for a September rate cut could place additional pressure on risk assets such as Bitcoin.

Traders have already pared back expectations for a large September cut, with futures currently pricing in only a 25-basis-point reduction.

Geopolitical developments also added to the pressure. On Monday, President Donald Trump hosted Ukrainian President Volodymyr Zelensky and European leaders to discuss future peace efforts. Trump said he is arranging direct talks with both Moscow and Kyiv, hinting at a possible trilateral summit.

While any credible negotiating path would support global risk sentiment in the long run, current uncertainty has weighed on the cryptocurrency market.

Fed Official Comments on Digital Asset Ownership

Michelle Bowman, the Fed’s Vice Chair for Supervision, said on Tuesday that central bank staff should be allowed to own small “de minimis” amounts of cryptocurrencies and digital assets.

She added that such a change would give regulators practical experience and strengthen their ability to oversee emerging financial technologies.

Bowman stressed that while risks are inherent in these assets, they must be balanced against potential benefits and not dismissed out of excessive caution.

Her remarks reflect a more engaged regulatory approach toward digital assets under the current administration.

What’s Next After Bitcoin’s Decline?

Bitcoin’s outlook appears weaker following a roughly 10% correction from its recent highs. The cryptocurrency hit a new record of $124,544 on August 14 but retreated after a brief breakout, posting a weekly low of $112,555 as profit-taking spread across the market alongside soft macroeconomic signals.

Tuesday’s drop saw Bitcoin break below the critical 50-day moving average support, which may now act as resistance.

Although the pullback is a natural reaction to the prior rally, the upcoming Fed meeting could significantly influence Bitcoin’s price. The crypto market had been in a bullish mode, driven by expectations of steep rate cuts, but those hopes are fading after mixed inflation data and strong jobs figures.

With the broader market entering a correction phase amid headwinds and macroeconomic uncertainty, second-layer infrastructure projects are gaining traction — including Bitcoin’s first Layer-2 solution, Bitcoin Hyper, which enhances the cryptocurrency’s utility and scalability.

Oil prices rose on Wednesday after data from the American Petroleum Institute showed a decline in US crude inventories, while investors awaited further developments in peace talks over the war in Ukraine, with sanctions on Russian crude still in place for now.

Crude had fallen by more than 1% on Tuesday amid optimism that a peace agreement might be near. However, US President Donald Trump acknowledged that Russian President Vladimir Putin may not be willing to reach a deal.

Brent crude futures rose 44 cents, or 0.7%, to $66.23 a barrel by 1000 GMT. US West Texas Intermediate futures for September delivery, expiring on Wednesday, gained 65 cents, or 1%, to $63 a barrel.

Giovanni Staunovo, analyst at UBS, said: “Oil prices seem to come under pressure one day and rebound the next. The API report was somewhat positive, so I assume some of the support for prices comes from that.”

The API data showed US crude stocks fell by 2.42 million barrels, according to market sources on Tuesday, ahead of the official figures due at 1430 GMT.

Staunovo added: “I’m not too sure about the peace deal – we’ll have to see whether any progress is made in the coming days.”

Trump said on Tuesday the US may provide air support as part of a deal to end the Russian war in Ukraine. He had earlier said he was arranging a meeting between Putin and Ukrainian President Volodymyr Zelensky, followed by a trilateral summit with the three leaders. But Russia has not confirmed participation in talks with Zelensky.

Daniel Hynes, senior commodity strategist at ANZ, said in a note on Wednesday: “The chances of a quick resolution to the conflict with Russia now look unlikely.”

Oil also received support from a disruption at a major US refinery due to flooding.

BP said on Tuesday that operations at its 440,000-barrel-per-day refinery in Whiting, Indiana, were affected by flooding from a severe thunderstorm, which could impact crude demand at the facility – a key fuel supplier in the US Midwest market.

The US dollar held steady on Wednesday as traders awaited Federal Reserve Chair Jerome Powell’s speech at the annual Jackson Hole symposium later this week, seeking clues about the path of monetary policy.

In contrast, the New Zealand dollar fell after the central bank cut its cash rate by a quarter percentage point to 3.0%, and revealed that its board had even discussed a larger half-point reduction.

The dollar index, which measures the greenback against six major peers, remained stable at 98.319 after touching its highest level in more than a week at 98.441 earlier in the day. Market focus is firmly on Powell’s remarks on Friday, as traders look for signals on whether he might push back against market pricing for a rate cut at the Fed’s September 16-17 meeting.

Current expectations show traders assigning about an 85% probability to a quarter-point cut next month, with a total of roughly 54 basis points in easing anticipated by year-end.

Kirstine Kundby-Nielsen, FX analyst at Danske Bank, said: “Powell will likely try to strike a balanced tone, but there is a risk he comes across as hawkish on Friday. Some of the inflation dynamics we have seen will make the Fed more cautious.”

Traders had raised bets on rate cuts after weaker-than-expected US jobs data earlier this month, alongside consumer price data showing only limited tariff-driven pressures. However, stronger-than-forecast producer prices last week complicated the outlook.

Powell himself has been hesitant to cut rates, citing expectations of higher prices due to tariffs this summer.

Later on Wednesday, the Fed is set to release minutes from its July 29-30 meeting, when it held rates steady. But these may offer little guidance, given they preceded the weak jobs report.

The New Zealand dollar slid 1.3% to $0.5815, its lowest since April 11, after policymakers also lowered their forecast for the terminal cash rate to 2.55% from 2.85% in May.

Prashant Newnaha, rates strategist at TD Securities, wrote in a client note: “The market was not expecting the bank to send such a strong dovish signal of further cuts ahead.” He now expects the cash rate to fall to 2.5% by November.

In Europe, the Swedish krona was steady after the central bank left its policy rate unchanged at 2%, in line with expectations.

The euro dipped 0.1% to $1.1636, while the dollar rose 0.1% against the Swiss franc to 0.8078 but eased 0.1% versus the yen to 147.61.

Sterling edged higher against both the euro and the dollar after UK inflation data beat expectations, leaving Britain with the highest inflation challenge among major advanced economies. Most of the rise in services inflation was driven by higher airfares, which some economists attributed to the timing of school holidays.

Chris Turner, head of research at ING, said: “The Bank of England is more concerned about food inflation, which hasn’t changed much in today’s report. We doubt the CPI print will significantly alter the Bank’s policy stance.”

In cryptocurrencies, Bitcoin stabilized around $113,897 after earlier dropping to $112,578.38, its lowest since August 3, pressured by the stronger dollar.