LME copper rose for the 11th time in 12 weeks, driven by rising Chinese demand, with the Yangshan copper premium hitting a near four-year high.

LME copper recorded its 11th weekly gain in nearly 12 weeks, as signs of a recovery in Chinese demand offset hawkish signals from the Federal Reserve.

Copper futures on the London Metal Exchange rose 0.2% on Friday to settle at $14,521.50 a tonne. During the past 12-week upward trend, copper prices hit a record high earlier this month. Year-to-date, copper prices have risen nearly 17%.

In China, the Yangshan copper premium, which measures import copper demand, rose to $124 per tonne on Friday, the highest level since November 2022, indicating a significant improvement in demand.

Meanwhile, the Federal Reserve announced its first interest rate hike since 2023 this week and signaled further tightening, but the impact on copper prices was relatively limited.

The market remains highly focused on the final outcome of the US copper tariffs. Analysts predict that, given the uncertain macroeconomic backdrop, base metals will generally remain range-bound in the short term.

Tariff expectations drive year-to-date gains; Fed rate hikes have limited impact.

One of the core reasons for the sharp rise in copper prices this year is the market's strong expectation that the Trump administration will impose tariffs on refined copper.

This expectation prompted a large influx of copper into the United States ahead of schedule, which squeezed the supply in other regions and pushed LME copper prices higher.

The Federal Reserve raised interest rates this week for the first time since 2023 and issued hawkish statements regarding further tightening. Although rising interest rates typically dampen demand for industrial commodities, this rate hike had little actual impact on copper prices, indicating that market confidence in demand has temporarily outweighed the pressure from interest rates.

Analysts at BMI, a subsidiary of rating agency Fitch, pointed out in a research report:

"Base metal prices are expected to remain largely range-bound in the coming weeks to absorb the impact of a larger-than-expected decline in production from Chile, the world's largest copper supplier, while the macroeconomic backdrop remains fragile."

Analysts added, "The market continues to await a clear decision on U.S. copper tariffs."

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