LONDON: Copper prices fell on Friday and were on track for their sixth straight week of losses on mounting fears that a global economic slowdown would dampen demand.
US Federal Reserve Chairman Jerome Powell said on Thursday an economic “soft landing” might be determined by factors that the central bank could not control, adding the battle to rein in inflation would “include some pain”.
“That’s a pretty scary message for the market ... it heightened the fears of a potential recession,” said ING analyst Wenyu Yao.
“In the short term, metals will remain under pressure,” she said, also citing the COVID-19 restrictions in top consumer China that had hobbled demand for metals and disrupted supply chains.
Shanghai was aiming to reach “zero-COVID” at the community level in the next few days and will then start to steadily ease traffic restrictions and open shops.
Benchmark three-month copper on the London Metal Exchange (LME) edged down 0.4% to $9,055 a tonne in official trading activity. It was on track for its sixth weekly decline, which would be its longest losing streak since 2019.
Copper is used in power and construction sectors and widely seen as a barometer of global economic growth. The metal is down about 7% so far this year after hitting a record high of $10,845 in March.
INVENTORIES: Weighing on prices was rising copper stocks in warehouses approved by the LME, which have climbed 35% so far this year to 177,000 tonnes, the latest exchange data showed.
TIGHTENING: Major central banks, including the US Federal Reserve, have been raising interest rates to tackle soaring inflation, stoking economic slowdown concerns.
CURRENCY: The US dollar steadied near a fresh 20-year high scaled on Thursday as investors flocked to the safety of the greenback, sapping demand for “riskier” assets such as commodities.
RUSSIA: Nornickel, the world’s largest producer of palladium and refined nickel, has become the first Russian company to be granted permission by a government commission to keep its listing abroad, for one year for now.
PRICES: LME aluminium climbed 0.2% to $2,748 a tonne, zinc lost 1.1% to $3,490, lead was down 0.9% at $2,073, tin eased 0.4% to $33,900 and nickel slipped 1.3% to $27,450.
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