Copper is beating gold. What lies ahead for the bronze metal’s rally.

Copper prices have taken off, gaining more than 20% in 2025 to just under $5 a pound in New York and outpacing gold’s 14% year-to-date gain. Some on Wall Street refer to the red metal as Dr. Copper, the joke being that it has a PhD in economics since rising copper prices are often a sign of growing industrial and consumer demand for autos, building materials, cell phones, and numerous other products that have copper in them. So, is copper’s surge a good sign for the global financial markets?

This year’s spike in prices seems to be more about President Donald Trump’s tariffs than booming economic demand.

Last month, the White House launched an investigation “into how copper imports threaten America’s national security and economic stability,” suggesting that there is the “potential need for trade remedies to safeguard domestic industry.” Trump followed that up earlier this month by saying in his address to a joint session of Congress that he was planning to impose a 25% tariff on copper, along with aluminum, steel, and lumber.

The threat of copper tariffs has led to exchanges in China, London, and the U.S. building up inventory to get ahead of any moves by Trump.

“Inventories at all three exchanges appear to show stockpiling ahead of potential tariffs,” say analysts at Ned Davis Research. The analysts note that this “has not spooked the copper market,” but acknowledged that “additional sharp inventory builds may be cause for concern” that “may mute a response once tariffs are announced officially.”

With that in mind, the Ned Davis analysts aren’t betting on higher copper prices. “Given rising concerns over global economic growth, we maintain our neutral view on copper,” they wrote, also noting that there continue to be questions about the health of China’s economy due to weak consumer demand.

Commodities strategists at Citi are also wary of buying into the copper rally. They say prices could rise a bit further in the near term due to “temporarily stronger US copper import demand” and supply constraints, but they expect copper prices to fall in the second half of the year “as US import demand fades and physical consumption and sentiment soften with broader US tariff implementation.”

Others argue that copper’s bull run could last a bit longer, mainly because tariff concerns will spur further buying.

“Copper’s rally could very well still have some legs and remain broadly insulated from the current macro risk-off sentiment,” says Ryan McKay, senior commodity strategist with TD Securities, in a report earlier this month.

Investors shouldn’t necessarily be wary of copper mining stocks. The metal continues to be an important part of the move to boost electrical power supply in the U.S. to support artificial intelligence technology. The AI boom has helped lift electrical components companies Eaton and Schneider Electric, for example.

Analysts at UBS say in a recent report that “the medium-term outlook for copper is compelling due to electrification & supply challenges.” The analysts recommend “high quality copper stocks” such as Southern Copper, London-based Antofagasta, and Freeport-McMoRan.

“We expect copper stocks to continue to trade at a premium to the diversified miners given the attractive medium-term fundamentals of copper,” the UBS analysts said. Freeport-McMoRan also has a big mining presence in the U.S. that should insulate it from tariffs.

The stocks also have the potential to catch up since they have lagged behind the rally in the metal itself. Freeport-McMoRan, for example, is up just 1.5% this year, while Southern Copper has gained 5.5%.

Even though copper prices may eventually cool, the mining stocks could still have some room to run.

Write to Paul R. La Monica at paul.lamonica@barrons.com