For the first two weeks of March, copper rallied 4.1%, hitting its highest level since April 2023.
A couple of factors identified by us at AOTH indicate that 2024 will be a great year for copper. Most important is supply failing to keep up with demand. The second factor is a weakening of the US dollar if market expectations of monetary easing come to pass.
The US Federal Reserve just had its March meeting, where it maintained its pause on rate hikes (federal funds rate @ 5.25-5.5%), and telegraphed 3 x 0.25% rate cuts, for a total of 0.75%. Most economists believe the first cut will be in June.
If the Fed lowers rates, the dollar will weaken, as it has done in the past during monetary easing. Commodity prices have an inverse relationship with the dollar; a lower dollar typically means higher commodity prices.