Copper extends rally as dollar weakens on Trump tariff report

Trump had floated the possibility of trade tariffs of 60% or higher on Chinese exports and levies of 10% to 20% on all imports during the presidential campaign

Copper extended this year’s rally following a report the incoming Trump administration will slowly ramp up trade tariffs rather than impose sizable levies in one go.

The report said the approach was aimed at boosting negotiating leverage and helping to avoid a spike in inflation, but the proposal is still in its early stages and hasn’t been shown to President-elect Donald Trump yet. It stirred some optimism in Asian stock markets and weighed on the dollar, making commodities priced in the currency more attractive for many buyers.

Trump had floated the possibility of trade tariffs of 60% or higher on Chinese exports and levies of 10% to 20% on all imports during the presidential campaign. The prospect of gradual implementation is relatively positive for the metal, which has risen 4% this year after falling last quarter on a strengthening dollar and as China’s efforts to revive growth proved largely ineffective. 

China will use a broad range of stimulus measures to offset the effects of expected US tariffs and a persistent housing downturn, Goldman Sachs Group Inc. Chief Economist Jan Hatzius told Bloomberg Television on Tuesday. Growth in the world’s top metal importer would likely slow to 4.5% this year from a probable 5% in 2024, he said.