(Bloomberg) -- Copper rallied with other risk assets as robust US economic data and easing Treasury yields boosted investor demand.

The metal rose as much as 1.4% on the London Metal Exchange, tracking moves in American and European stocks. Sentiment was buoyed by US purchasing managers’ indexes that showed business activity picking up following back-to-back months of stagnation.

The rally follows copper’s slide to the lowest since November on Monday, under pressure from a surge in US bond yields that undermine non-interest bearing assets. Benchmark 10-year Treasury yields have since eased back, providing some relief for commodities. 

With demand from China — the world’s top copper consumer — showing resilience, the focus is shifting to US monetary policy. Fed Chairman Jerome Powell will give a speech in Washington on Wednesday, which will be closely watched for indications of the US interest-rate path.

Anything pointing to further tightening is likely to be negative for copper, as higher interest rates raise costs for manufacturers and construction firms, while undermining consumer buying. Last week Powell indicated the Fed would hold rates steady next month, while keeping the prospect of another hike open.

Copper was up 1% to $8,050 a ton on the London Metal Exchange as of 5:41 p.m. local time. Other metals also rallied, with aluminum and zinc both adding more than 1%.

--With assistance from Mark Burton and Annie Lee.

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