COMEX May 22 Copper Roundup

New York, May 22 news: Copper futures on the Chicago Mercantile Exchange (COMEX) fell on Monday.

As of the close, copper futures fell by 4.15 cents to 4.85 cents. Among them, the most actively traded July 2023 copper closed at $3.685 per pound, down 4.7 cents or 1.26% from the previous trading day.

July copper traded in a range of $3.6675 to $3.7375.

Worries about the U.S. recession and the risk of debt default, coupled with weaker-than-expected economic growth in China, have raised concerns about the outlook for demand, prompting speculative funds to continue selling in the copper futures market, putting pressure on copper prices.

U.S. President Joe Biden will meet with House Speaker Kevin McCarthy on Monday to discuss raising the government's debt ceiling. Failure to raise the debt ceiling in a timely manner will trigger unprecedented defaults.

A rise in the U.S. dollar index on Monday also weighed on copper. The dollar got a boost after a Fed governor said the central bank may still need to raise its benchmark interest rate by another 50 basis points this year. The Fed has raised interest rates 10 times since last March, raising rates from 0.25% to 5.00% to 5.25%.

The recent COMEX copper contract has fallen 5.06% so far this month and 3.46% so far this year. The closing price on Monday was 15.49% lower than the same period last year and 25.46% lower than the historical peak reached in March 2022. COMEX copper futures fell by 14.6% in 2022, mainly because the outlook for global economic growth is worrying. High inflation prompted European and American central banks to actively raise interest rates to curb inflation, exacerbating the risk of economic recession. In contrast, copper has recorded two consecutive years of gains of 25% in 2020 and 2021, as the green transition of the global economy and electrification help boost additional demand for the metal, which is widely used in the power and construction industries, while copper mines face challenges. Disruptions such as underinvestment and production disruptions.

The July 2023 copper contract on the Shanghai Futures Exchange closed down 320 yuan at 65,110 yuan a tonne on Monday. Bonded copper futures for July delivery on the Shanghai International Energy Exchange (INE) fell 280 yuan to 57,790 yuan a tonne.

From the perspective of fund dynamics, the position data released by the US Commodity Futures Trading Commission (CFTC) showed that last week, speculative funds sold a net of 42,000 lots in the copper futures market for the fourth consecutive week. As of May 16, 2023, speculative funds held a net short position of 22,621 lots in the COMEX copper futures and options market, an increase of 6,451 lots from the previous week, and a net sell of 503 lots in the previous week.

In warehouses registered with the Shanghai Futures Exchange, copper inventories fell to 102,511 tons on Friday, down 15,872 tons from 118,383 tons a week earlier. %.

On Monday, the trading volume of COMEX copper futures was 68,229 lots, compared with 69,117 lots in the previous trading day; the empty position was 208,674 lots, compared with 210,807 lots in the previous trading day.