Copper futures advanced on Tuesday as financial markets monitored incoming Treasury Secretary Janet Yellen’s testimony on Capitol Hill. Investors are confident that Yellen will push for more fiscal spending over the next four years to ensure the economy can recover from the coronavirus-induced economic collapse. Copper is also benefiting from stronger fundamentals.

March copper futures tacked on $0.026, or 0.72%, to $3.628 per pound at 17:37 GMT on Tuesday on the New York Mercantile Exchange. Copper prices have been subdued in recent sessions, but they have reignited the rally, climbing as high as $3.65.

The former Federal Reserve Chair spoke during the Senate confirmation hearing, signaling that she intends to take a more hands-off approach for the dollar, as well as pushing for further stimulus. Yellen revealed that the US economy would be in rough shape over the next year, but she is confident that with enough stimulus and relief, the US can withstand the pressure.

Since hitting a peak of 103.00 last spring, the US Dollar Index (DXY) has been in a freefall, sliding below the 90.00 mark. The DXY slipped 0.25% to 90.54, from an opening of 90.73. A stronger buck is bad for commodities priced in dollars because it makes it more expensive for foreign investors to purchase.

But copper markets are unlikely to be threatened by the new administration’s position because the fundamentals are driving the industrial metal.

According to S&P Global Platts, copper prices are forecast to rise in 2021 amid low inventories and bullish demand, although industry analysts believe demand will expand slower than initial projections. In the near-term, copper will find support on the upcoming elections and labor negotiations unfolding in Chile and Peru.

ABN AMRO Group senior economist Industrial Metals Markets Casper Burgering told the organization:

This provides a lot of confidence. As a result, total long positions are high, but this also brings a downside price risk because it increases the likelihood of profit-taking by speculators. In 2020, the market has taken a substantial advance on the good news of 2021. The copper price will rise further in 2021, but in a lower gear.

So, what is the average price markets are penciling in for this year? Bank of America analysts are forecasting $4.31 by the fourth quarter of 2021, citing a modest deficit in the global copper market.

It should be noted that investment funds have shaved their collective net long positions in copper.

In other metal markets, February gold futures tacked on $11.00, or 0.6%, to $1,840.90 per ounce. March silver futures rallied $0.444, or 1.79%, to $25.31 an ounce. March platinum futures were flat at $1,090.50 per ounce. March palladium futures tumbled $31.10, or 1.3%, to $2,364.00 an ounce.