Copper hit its second-highest close on record earlier this week. By Friday morning, traders were dumping it.

According to Bloomberg News, copper slumped alongside other base metals as caution swept through risk assets ahead of the US employment report due this afternoon. The jobs number carries outsized weight right now — it's a direct signal to traders about Federal Reserve rate policy over the next 12 months.

A strong jobs print means the Fed likely raises rates. Higher rates mean a stronger dollar. A stronger dollar makes dollar-denominated commodities more expensive for foreign buyers. Demand drops. Prices fall. That's the chain traders are pricing in before the report even drops.

Iron Ore Worse — Four Weeks of Losses

Iron ore is in rougher shape than copper. Singapore futures hit $100.85 per ton on Friday — the weakest level since March 6 — before partially recovering to $101.80 as of late morning Singapore time, according to Bloomberg's Katharine Gemmell. That puts iron ore down 3.4% for the week.

This is the fourth consecutive weekly loss.

Two forces are driving it: China's steel market is entering a seasonal slowdown, and Australia is expected to ship more iron ore supply into that weakening demand environment. More supply hitting softer demand means prices move in one direction.

What the Middle East Is Doing to Metals

Bloomberg also flagged Middle East war concerns as a factor in the metals retreat. This is real but often underweighted in commodity coverage.

War risk doesn't just spike oil. It hits industrial metals through two channels. First, risk-off sentiment pushes investors out of commodities broadly. Second, if the conflict disrupts shipping lanes or escalates, global manufacturing outlook takes a hit — and that kills demand forecasts for copper, aluminum, and steel inputs like iron ore.

Given that Iran-US nuclear talks remain stalled as of June 4 — with Iran saying there was 'no tangible progress' while Trump claimed a deal was close — the geopolitical uncertainty isn't going away this weekend.

Copper Fundamentals vs. Financial Markets

Most commodity coverage is treating Friday's selloff as a simple pre-data pause.

But copper hit near-record highs this week while US commercial copper inventories have been draining fast and Zambia's copper sector faces a debt dispute that could constrain future supply. Traders are hitting the sell button over macro fears at the same time physical supply is tightening. These forces are in conflict — the physical fundamentals suggest prices should stay elevated, while the macro layer is pulling in the opposite direction.

The Fed Wildcard

The US jobs report today is the single most important data point for commodities through the next Fed meeting.

Bloomberg notes the consensus expectation is for a solid jobs increase — which would push expectations toward a Fed rate hike within the next 12 months. If that lands as expected, dollar strength continues, and metals face more pressure heading into next week.

If the number comes in weak, the calculus flips. Rate hike fears ease, dollar softens, and copper especially could snap back hard given the tight physical inventory situation.

Why This Matters Beyond Wall Street

Copper is everywhere — wiring, plumbing, EVs, the electrical grid buildout this country needs. When copper swings 3-4% in a week, that's eventual cost pressure on construction, manufacturing, and energy infrastructure.

Iron ore feeds the steel industry. Steel feeds everything from bridges to car frames. Four straight weeks of losses might relieve some steel price pressure in the short term, but it also signals that Chinese industrial demand — the engine of global metals consumption — is softening.

Both matter to American workers and consumers. The metals market isn't just a Wall Street game.

Today's jobs report will tell us a lot about where this goes next.