Good morning and welcome to Markets Desk, your midday read on what's moving markets and policy.
Copper is the commodity story of the moment, hitting an all-time high as a supply shortage collides with a major production outage. High demand from electrification and AI infrastructure, combined with aggressive stockpiling ahead of potential tariffs, has traders scrambling. The physical market is tighter than it has been in years.
Feeding directly into that inflation picture, Federal Reserve researchers are now confirming what many economists suspected — Trump's tariffs have passed through almost entirely to American consumers, adding close to a full percentage point to inflation. The study puts numbers to a debate that has run since the tariff regime began, and it complicates the Fed's path on rates considerably.
And speaking of pressure on household budgets, gasoline is now averaging over four dollars and fifty cents nationally, with California touching over six dollars. The culprit is the ongoing conflict with Iran and the closure of the Strait of Hormuz. President Trump is now backing a suspension of the federal gas tax, with Republican Senator Josh Hawley set to introduce legislation — though economists warn the move would widen the deficit and starve highway infrastructure of critical funding.
That's the tape. Markets Desk, signing off the floor.
