SMM

Copper prices edged down in May, and rebounded at the end of the month. Affected by the debt ceiling issue and the lingering bank liquidity risks in early May, the market’s risk aversion increased, weighing on risky assets such as copper prices. A combination of the deal reached by President Biden and Speaker Kevin McCarthy on the debt ceiling issue at end-May and the US Beige Book showing insignificant impact on the current economy from bank liquidity risks boosted market confidence.  Copper prices rebounded amid eased risk aversion. Notably, raising the debt ceiling is conducive to the stability of the financial market, but that may push up the US dollar and US Treasury securities in the short term. The Fed’s interest rate hike decision will remain the focus of markets in June. Various data indicated that the US economy is gradually slowing down and the Fed is expected to suspend interest rate hikes in June. Inflation data of major European economies slowed down in May.