Copper prices climbed to a five-week high on Friday and were on track to end August up 3%, supported by a weaker US dollar and growing bets that the Federal Reserve will cut interest rates in September.

The three-month copper contract on the London Metal Exchange rose 0.8% to $9,897.50 per metric ton by 10:11 GMT, after hitting $9,917 – its highest level since July 25.

The US dollar was set to post a 2% monthly decline in August. A weaker dollar makes dollar-priced metals more attractive to buyers using other currencies, while lower interest rates improve investor sentiment toward industrial metals that depend on economic growth for demand.

In China, the world’s largest consumer of metals, stocks closed higher on Friday, marking their strongest monthly performance since September 2024, with abundant liquidity continuing to fuel gains.

Shanghai Futures Exchange copper inventories fell 2.4% this week, while the Yangshan copper premium – reflecting demand for imported copper into China – held steady at $55 per ton, its highest level since June 5.

Still, factory activity in China likely contracted for a fifth straight month in August, according to a Reuters survey, as manufacturers await more clarity on a trade deal with the US, while weak labor markets and the property crisis weigh on domestic demand.

Goldman Sachs maintained its year-end forecast for copper on the LME at $9,700 per ton.

The bank said in a note: “While LME inventories remain relatively low, we do not see imminent risks of a global copper shortage.”

According to the International Copper Study Group (ICSG), the global refined copper market posted a surplus of 251,000 tons in the first half of 2025, compared with a surplus of 395,000 tons in the same period last year.

Other LME Metals Performance

Aluminum rose 0.3% to $2,613 per ton.

Zinc gained 1.1% to $2,812.

Lead added 0.2% to $1,987.50.

Tin advanced 1.0% to $35,140.

Nickel rose 0.7% to $15,365.

Bitcoin slipped toward $111,000 in volatile trading on Friday as investors awaited key US inflation data, while weighing growing expectations that the Federal Reserve will cut interest rates next month, amid ongoing concerns about the central bank’s independence.

As of 01:57 Eastern Time (05:57 GMT), the world’s largest cryptocurrency was down 1.5% at $111,229.6. Earlier this week, Bitcoin had dropped to a seven-week low below $109,000 before rebounding slightly.

Even so, the token has lost more than 10% since its record high in August above $124,000, and it is on track to post its first monthly decline since April. Bitcoin is set to fall about 4% in August after four consecutive months of gains.

US inflation data in focus as rate-cut hopes rise

Traders are focused on the Personal Consumption Expenditures (PCE) price index – the Fed’s preferred gauge of inflation – due later on Friday. A softer reading could support prospects for monetary easing, while stronger figures may reduce bets on a rate cut.

Markets are currently pricing in an 85% chance that the Fed will cut rates by a quarter point in September, with additional easing expected by year-end. Risk assets such as cryptocurrencies typically benefit from lower rate expectations, but President Donald Trump’s attempt this week to dismiss Fed Governor Lisa Cook has dampened risk appetite.

Cook has refused to resign and filed a lawsuit challenging the decision, warning that her removal would undermine the Fed’s independence. The rare confrontation has unsettled investors concerned about political interference in monetary policy.

Trump-backed Bitcoin miner eyes Nasdaq listing

American Bitcoin – a mining firm backed by Eric Trump and Donald Trump Jr. – is preparing to begin trading on Nasdaq in early September 2025 via a reverse merger with Gryphon Digital Mining, according to a Reuters report. The report added that the Trump brothers and major investor Hut 8 collectively control about 98% of the company’s shares.

Oil prices fell on Friday but remained on track for weekly gains, as uncertainty over Russian supplies was offset by expectations of weaker demand with the US summer driving season, the world’s largest fuel consumer, nearing its end.

Brent crude for October delivery — expiring Friday — dropped 57 cents, or 0.8%, to $68.26 a barrel by 10:34 GMT, while the more active November contract slipped 43 cents, or 0.6%, to $67.55. US West Texas Intermediate (WTI) crude fell 42 cents, or about 0.7%, to $64.18.

On a weekly basis, Brent was up 0.6% while WTI gained 1%.

Thomas Varga, analyst at PVM Oil Associates, said the market was beginning to shift part of its focus to next week’s OPEC+ meeting.

Crude production from OPEC and its allies has increased, with the group accelerating output hikes to regain market share, raising supply expectations and weighing on global oil prices.

Prices had earlier been supported this week by Ukrainian strikes on Russian oil export terminals.

Ole Hvalbye, analyst at SEB, noted in a report that US crude inventories for the week ending August 22 showed a larger-than-expected draw, signaling that late-summer demand remained firm, particularly in industrial and shipping sectors.

Still, the end of the US summer driving season with the Labor Day holiday on Monday, along with higher supply from major OPEC+ producers, has added pressure on prices.

Vivek Dhar, commodity strategist at Commonwealth Bank of Australia, forecast Brent prices could fall to $63 a barrel in the fourth quarter of 2025.

Investors are also watching India’s response to US pressure to halt purchases of Russian crude, after President Donald Trump on Wednesday doubled tariffs on Indian imports to 50%.

So far, India has continued to defy Washington, with traders saying Russian oil shipments to India are set to rise in September.

“The prevailing view is that sanctions on Russia are not imminent, and India will ignore US threats and continue to buy deeply discounted Russian crude,” Varga of PVM said.

The US dollar held steady on Friday but was on track to record a 2% decline in August against major peers, as markets increasingly bet on a Federal Reserve rate cut next month while concerns persist over threats to the central bank’s independence.

The euro was unchanged at 1.1677 dollars, while the British pound slipped 0.2% to 1.3474 dollars. Both currencies are heading for monthly gains of over 2% against the dollar. Against the Japanese yen, the dollar was steady at 146.975.

The greenback came under additional pressure from President Donald Trump’s efforts to expand his influence over monetary policy, including his attempt this week to remove Fed Governor Lisa Cook.

Cook has filed a lawsuit asserting that Trump lacks the authority to dismiss her, along with a request for a temporary restraining order, with a hearing scheduled for Friday. The legal dispute marks the latest chapter in Trump’s push to reshape the Fed, after repeatedly criticizing the central bank and its Chair Jerome Powell for not cutting rates more aggressively.

Market reaction, however, has been relatively muted, with only modest dollar selling and minor moves along the yield curve, as investors remain focused on the near-term outlook for Fed easing.

According to CME’s FedWatch tool, markets are pricing an 86% chance of a rate cut in September, up from 63% a month ago.

Francesco Pesole, FX strategist at ING, wrote in a note: “While investors are still hesitant to trade heavily on this Fed-related story and remain focused on short-term data-driven developments, downside risks to the dollar have undoubtedly increased.”

Separately, Fed Governor Christopher Waller said on Thursday that he supports starting rate cuts next month and expects further reductions in the following months to bring the policy rate closer to “neutral.”

Investors are also awaiting Friday’s release of the Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation measure. The index is expected to show an annual rise of 2.6%, unchanged from June. Tony Sycamore, market analyst at IG, said a reading of 3% or higher could raise concerns given the Fed’s recent dovish shift, though the key focus remains next Friday’s US jobs report ahead of the September FOMC meeting.

In Europe, an ECB survey showed consumer inflation expectations in July remained broadly stable at or above the central bank’s 2% target. Separate data showed French consumer prices rose less than expected in August, while Spain’s EU-harmonized inflation rate held steady at 2.7%. Pesole said: “We do not think this data will prompt markets to significantly reprice ECB rate expectations at this stage.”

Elsewhere, the New Zealand dollar edged higher after Reserve Bank of New Zealand Chair Neil Quigley announced his resignation, following the surprise departure of the central bank’s governor earlier this year.

Meanwhile, the Chinese yuan climbed to its strongest level in 10 months against the dollar, supported by official currency fixing and a rally in local equities, while the Indian rupee hit a record low amid concerns over the economic fallout from steep US tariffs on Indian imports.