BENGALURU- London copper eased on Wednesday, following US President Donald Trump’s threat to impose 25 percent tariffs on automobiles and semiconductor chips, which could weigh on the metal’s demand.
Three-month copper on the London Metal Exchange (LME) eased 0.3 percent to $9,446 a metric ton.
Trump said on Tuesday he intends to impose auto tariffs “in the neighborhood of 25 percent” and similar duties on semiconductors and pharmaceutical imports, the latest in a series of measures threatening to upend international trade.
Trump said sectoral tariffs on pharmaceuticals and semiconductor chips would also start at “25 percent or higher, and it will go very substantially higher over the course of a year.”
“Trump is actually considering implementing further tariffs on auto, he suggested the idea of a 25 percent increase, which could lead to a slowdown in global growth and may result in disruptions to the global supply chain. Such disruptions could cause copper to experience some weakness going forward,” said Kelvin Wong, OANDA’s senior market analyst, Asia Pacific.
“We think President Trump is more motivated to impose tariffs on copper in his second term because of the metal’s growing importance to key emerging global competitive industries like the energy transition and AI,” Citi said.
