Copper prices hit a new all-time high of $11,200 per metric ton on the London Metal Exchange (LME) on Wednesday, marking a historic rally fueled by a combination of macroeconomic and micro-level factors, alongside a strong return of investment funds to the market after months of caution.

Market data show that speculative long positions held by investment funds in LME copper futures have climbed to their highest level since March — just before what US President Donald Trump called “Liberation Day,” when he launched a wave of tariffs that roiled global markets.

Fears of a full-blown trade war between the United States and China — the world’s largest copper consumer — had heavily weighed on prices earlier in the year. However, the recent partial truce between Trump and Chinese President Xi Jinping has eased some of that pressure, reviving investment appetite for the red metal.

On the supply side, challenges continue to mount. A report by the International Copper Study Group (ICSG) warned that a string of disasters affecting global mines this year could lead to a refined copper supply deficit by 2026. With global inventories already shrinking, it’s easy to see why “Dr. Copper,” as the metal is often called, has returned to the spotlight.

Smart money returns

Following the turmoil in March, investment funds largely avoided copper, wary of potential US tariffs on refined metal. As a result, speculative positions on CME copper contracts fell to their lowest in a decade by August.

But as prices began to recover in August and major producers announced output cuts, long positions in LME copper jumped from 55,325 to 87,152 contracts, while short positions declined — a net shift equivalent to more than one million metric tons of buying pressure.

In the United States, open interest in CME copper also rose to a four-month high, though the weekly Commitment of Traders (COT) report remains unavailable due to the ongoing US government shutdown, complicating fund-flow tracking.

Inventory imbalance

Short positions on LME copper have nearly halved since April, as the sharp price rally forced momentum funds to unwind bearish bets.

Low inventory levels in LME warehouses have further discouraged short-selling, after the spread between cash prices and three-month futures briefly spiked to $224 per ton earlier this month.

Although the market has since returned to contango (where futures prices exceed spot prices), the current $25 spread remains well below August’s $90 level.

Meanwhile, the tariff standoff between Washington and Beijing continues to distort global trade flows. Despite the US delaying new tariffs on refined copper until next July, CME spot prices remain roughly $300 per ton higher than those on the LME — keeping the US import window open and drawing metal out of international markets.

According to Richard Holtom, CEO of Trafigura, shipments to US ports may have slowed but continue to drain LME inventories, which have fallen to just 135,350 tons from 159,000 tons in July. Off-warrant stocks are estimated at only 30,477 tons.

In China, refined copper exports plunged from 118,400 tons in July to 26,400 tons in September, mostly destined for Thailand and Vietnam — neither of which hosts LME-registered warehouses.

Volatility ahead

The persistent price gap between US and international copper reflects the ongoing tariff impact, a factor that could backfire on funds that have re-entered the market aggressively. Any shift in the trade outlook between Washington and Beijing could easily derail the current optimism.

Despite Trump’s description of his meeting with Xi as “tremendous,” markets remain uncertain whether the truce marks a lasting strategic shift or merely a tactical pause.

Copper prices slipped back below $11,000 per ton on Thursday morning as investors cautiously reassessed geopolitical and trade risks.

While fundamental factors such as supply and demand remain strongly supportive, the broader macro environment remains uncertain — suggesting that the bouts of price volatility seen this year are far from over.

Bitcoin moved slightly on Friday, heading for a monthly loss in October and breaking what investors call the “Uptober” trend — a seasonal rally the market has typically enjoyed. The decline came amid rising global risks and renewed trade tensions between the US and China, which dampened investor appetite for risk assets such as cryptocurrencies.

Bitcoin slipped 0.3% to $110,012, marking a monthly drop of around 3.7% in October.

Analysts said markets found little encouragement from the recent meeting between US President Donald Trump and Chinese President Xi Jinping, as a tangible trade agreement between the two nations remains distant.

The crypto market also faced additional pressure earlier in the week from the Federal Reserve’s hawkish comments, while the strong rally in US tech stocks — fueled by optimism over artificial intelligence — had little impact on Bitcoin’s movement.

A rare seasonal decline: “Uptober” fails for the first time since 2018

Contrary to expectations, Bitcoin is on track for its first October loss since 2018, a month historically seen as positive for digital assets.

This was partly driven by escalating trade tensions between Washington and Beijing, which triggered a flash crash earlier this month from record highs. Since then, Bitcoin has failed to break above the $110,000 level, while spot and derivatives data show investors avoiding large positions.

Market indicators suggest cryptocurrencies have decoupled from US tech stocks in October, as the latter continue to rally to record highs on AI-driven momentum. For instance, the Nasdaq Composite is expected to post gains exceeding 4% this month.

Strong earnings for Bitcoin-linked firms

Shares of MicroStrategy Inc., the world’s largest corporate holder of Bitcoin, rose 6% in after-hours trading Thursday after the company reported stronger-than-expected results for the third quarter ended in September.

The firm said its performance was supported by record Bitcoin prices during the past three months.

CEO Michael Saylor reiterated his forecast that Bitcoin could reach $150,000 by the end of 2025.

Crypto exchange Coinbase Global Inc. also reported upbeat quarterly results, with strong growth in trading volumes during the third quarter pushing its shares higher on Thursday.

Broad decline in altcoins

Altcoins followed Bitcoin’s trajectory through October, posting steep losses.

Ethereum dropped 1.8% to $3,849.69, down 7% for the month. XRP fell 3%, bringing its monthly loss to 12.6%, while Solana declined 11% and Cardano plunged 24%, making it the worst performer among major tokens.

Binance Coin (BNB) was the notable exception, rising about 9% in October.

Among meme coins, Dogecoin slid 20% during the month, while $TRUMP gained roughly 9% following a sharp rally earlier this week.

Oil prices fell on Friday, heading for a third consecutive monthly loss, pressured by a stronger US dollar, weak economic data from China, and rising supplies from major producers around the world.

Brent crude futures dropped 38 cents, or 0.6%, to $64.62 a barrel by 10:08 GMT, while US West Texas Intermediate (WTI) futures slipped by a similar margin to $60.19 a barrel.

The losses came as the US dollar climbed to a three-month high against a basket of major currencies, making dollar-denominated commodities such as oil more expensive for holders of other currencies.

Falling prices in Asia and weak Chinese demand

Reuters reported that Saudi Arabia, the world’s top oil exporter, may cut its official selling prices to Asia in December to the lowest level in several months amid ample supply in the market — a move reflecting a further bearish tone.

Prices also came under pressure after an official Chinese survey showed manufacturing activity contracting for the seventh straight month in October, reinforcing concerns over slowing demand in the world’s second-largest oil consumer.

High supply and lower prices

Both Brent and WTI are on track to end October about 3.5% lower, as OPEC and major non-OPEC producers continue to increase output in a bid to defend market share.

Analysts noted that the additional supply could offset the impact of Western sanctions on Russian oil exports to China and India — the two biggest importers of Russian crude.

Leaked reports suggest the OPEC+ alliance is leaning toward another small production increase in December, according to sources familiar with internal discussions ahead of the group’s meeting on Sunday.

Since the start of the recent series of monthly increases, eight member states of the alliance have raised their collective output targets by over 2.7 million barrels per day — roughly 2.5% of global supply.

Record output in Saudi Arabia and the United States

Data from the Joint Organizations Data Initiative (JODI) showed Saudi crude exports reached 6.407 million barrels per day in August, the highest in six months.

In the United States, the Energy Information Administration (EIA) reported record production of 13.6 million barrels per day last week, intensifying concerns about a potential supply glut in global markets.

US–China: Unclear energy agreement

US President Donald Trump said Thursday that China had agreed to start purchasing American energy, noting the possibility of a large deal involving oil and gas from Alaska.

However, analysts expressed doubts about whether the trade understanding between Washington and Beijing would meaningfully boost Chinese demand for US energy, given the slowdown in China’s economy and persistent weakness in its manufacturing sector.

The Japanese yen rose on Friday after newly appointed Finance Minister Satsuki Katayama said the government is monitoring currency movements “with a high degree of sensitivity,” even as the yen heads for its weakest monthly performance against the dollar since July.

The move followed a volatile week for Japan’s currency, which briefly strengthened after US Treasury Secretary Scott Bessent criticized the Bank of Japan for not hiking rates quickly enough, only to fall again after the central bank left its policy unchanged as widely expected.

Katayama also walked back comments she made in March, when she estimated the yen’s fair value between 120 and 130 per dollar. She said Thursday that such remarks were “no longer appropriate” given her current role overseeing monetary policy — a statement that dampened optimism among traders betting on a stronger yen.

Tokyo inflation adds pressure on the Bank of Japan

Government data released Friday showed Tokyo’s core consumer prices rose 2.8% in October from a year earlier, exceeding forecasts and keeping inflation above target, complicating the BOJ’s task of determining when to begin tightening policy.

In European trading, the yen edged higher, with the dollar trading at 154.28 yen, slightly above a nine-month low for the Japanese currency. The yen has fallen about 4% against the dollar in October — its worst monthly showing since July — and also hit a record low against the euro.

“We’re reaching the point where yen weakness has become a genuine political concern in Japan,” said Sim Moh Siong, FX strategist at Bank of Singapore.

Meanwhile, the US Dollar Index held near a three-month high, supported by risk-off sentiment following a busy week of central-bank decisions, tech earnings, and an initial trade-truce deal between the US and China.

“Risk aversion is playing in favor of the dollar,” said Rodrigo Catril, currency strategist at National Australia Bank. “There’s still uncertainty over whether the Fed will actually deliver another rate cut in December.”

According to CME’s FedWatch tool, the probability of a December rate cut has fallen to about 75%, down from more than 90% a week earlier.

Euro steady, pound weakens

The euro rose 0.1% to $1.1572 after the European Central Bank kept rates unchanged at 2% for a third straight meeting, saying monetary policy is “well positioned” as economic risks ease. Still, the euro remains down roughly 1.4% against the dollar for October.

The British pound slipped to $1.3145 amid rising political pressure on UK Finance Minister Rachel Reeves. Sterling is heading for a monthly loss of about 2.3%, while gilt yields fell as investors sought safety ahead of November’s budget announcement and its potential economic fallout.

“The UK’s economic outlook looks fragile, and markets don’t like uncertainty,” said Fiona Cincotta, senior market analyst at City Index. “The government is in a difficult spot with very few options — and that’s showing up in sterling’s weakness.”

In Asia, the dollar held steady around 7.111 yuan in offshore trading, even after data showed China’s factory activity contracted for a seventh consecutive month in October, missing expectations.