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The metal, which is frequently seen as a gauge of economic activity, reached lifetime highs of $10845 per ounce on the LME on March 22. However, it lost all of its gains as a result of China's zero Covid-19 policy which was put in place in the wake of the virus outbreak witnessed in the cities of Shanghai and Beijing, eventually slowing down industrial activity, causing the manufacturing PMI to fall below the 50-mark, indicating signs of a slowing economy. Further pain came as the US Fed had to raise interest rates as a result of the US inflation rate rising to 8.6 percent, the highest level since December 1981. After slashing its interest rates to near zero levels, the Fed has delivered 3 rate hikes for the year 2022, keeping the policy rates at 1.75.

A strong dollar index that soared to all-time highs made the dollar-denominated metal expensive for owners of other currencies, which was another hindrance to the decline in copper prices. The US Fed has reaffirmed that it would keep raising interest rates in response to growing inflation in order to keep prices under control. However, rapidly rising interest rates and dismal economic data have stoked fears of a recession that would cut demand for copper and other base metals.

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