It was once a truism that as the price of copper rises, so does the outlook for the global economy because copper is used in so many different industries. In fact, people in financial circles have taken to calling it “Dr. Copper,” joking that it must have a PhD in economics because it’s so good at predicting the future.
Copper prices have been on the rise lately — up 45% this year, and hitting a record high earlier this month. But it’s not the reliable indicator it once was.
“[Historically] if you saw sort of uptick in demands for copper, you said, ‘Oh, OK, right. We’re building more houses. We’re building more cars, right? So things must be going well in the economy,’” said Ian Lange, an economist at Colorado School of Mines.
While manufacturers do still use copper in cars and houses and appliances, “in the world of 2026, it’s really more about the strategic end uses,” said Jacob White, director of ETF product management at Sprott Asset Management.
These days, tons of copper goes into data centers, electricity infrastructure, and defense systems. And because it’s being used for “strategic” industries, the price of copper is a bit less tied to broader ups and downs in the economy.
“When electricity grids, for example, or AI data centers or defense programs are procuring copper, it doesn’t necessarily matter to them that copper is at an all-time high,” White said.
It isn’t just demand keeping that price high, though.
For one, there have been several recent disruptions at copper mines around the world, said Natalie Scott-Gray, senior metals analyst at the financial firm StoneX.
“We’ve had earthquakes. We’ve had flooding in Indonesia, which really can’t be helped,” she said.
Plus, many of those mines are old, so they’re getting more expensive to operate.
Then, there’s tariffs. The Trump administration has been signalling that it might tax imports of refined copper for over a year now.
It hasn’t done so yet, but companies are still sending tons of copper to the U.S. to get ahead of potential tariffs. And that has global implications.
“So we’ve had this extreme tightening in the market outside of the U.S. and that’s really been the primary driver why we have very high copper prices,” Scott-Gray said.
All that, she said, is diminishing Dr. Copper’s accuracy as an economic forecaster.
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