NEWYORK
Copper prices fell for a third consecutive session as the latest consumer price index reading exceeded consensus estimates, resetting Federal Reserve rate-hike probabilities higher across the curve.
Fixed-income traders repriced a more aggressive Fed stance immediately following the inflation report, pushing two-year yields higher and compressing yield spreads. The higher discount rate on future cash flows hit industrial metals hardest, with copper leading the selloff.
A stronger dollar—reflecting the market's repricing of U.S. interest rate differentials—added pressure. Dollar-denominated commodities become more expensive for international buyers when the greenback appreciates, further reducing demand for cop. Equity markets followed bond weakness lower. The Nasdaq fell 1.9 percent, the S&P 500 dropped 1.1 percent, and the Russell 2000 declined 1.9 percent.
