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Copper prices are holding steady as traders await the US Federal Reserve's interest rate decision, with slight increases in both London and Shanghai signaling cautious optimism.

What does this mean?

Copper traded within a narrow range, rising 0.2% to $9,076.5 per metric ton on the London Metal Exchange and similarly in Shanghai, as traders prepare for the Fed's next announcement. The market sees a 94% chance of a rate cut, despite strong US services data from S&P Global. In China, November's retail sales figures were disappointing, leading to calls for Beijing to boost consumer spending. However, China's industrial output showed slight growth. Meanwhile, other metals had varied performances: aluminum dipped while zinc and tin gained slightly on both the LME and SHFE.

Copper's steadiness mirrors market caution ahead of US monetary policy changes. Traders are waiting for a potential Fed rate cut, which could influence the dollar's strength and, consequently, commodity prices. Any changes here might signal broader trends in the industrial metals market, impacting sectors like construction and electronics.

The bigger picture: Global economic puzzles.

As China, a major copper consumer, faces slow retail growth, the global economic outlook stays uncertain. While industrial activity offers some hope, Beijing's next moves to boost consumer demand will be crucial. Alongside the Fed's decisions, these elements could significantly affect global growth forecasts and market dynamics in the months ahead.