LONDON: Copper prices rose on Thursday as China’s measures to support economic recovery helped to alleviate price pressure from high inventories while the market awaits interest rate decisions in the euro zone and China.
Three-month copper on the London Metal Exchange (LME) was up 0.5% at $8,459 per metric ton by 1044 GMT after touching a one-week high of $8,463.
Demand for copper, used in power and construction, has been muted this year by a patchy post-COVID economic recovery in top metals consumer China while a relatively strong U.S. currency makes dollar-priced commodities more expensive for buyers using other currencies.
“We are certainly seeing the battle between a strengthening dollar versus supportive stimulus out of China and better than expected data (in China) for August,” said StoneX analyst Natalie Scott-Gray.
Copper subdued ahead of U.S. inflation data
“(China’s) August economic data releases have been suggestive that we may have hit the bottom and are about to see a turnaround in metal demand. However, the release of numbers tomorrow will be critical.”
The country’s central bank is expected to boost liquidity while keeping the borrowing costs steady when rolling over its medium-term policy loans on Friday, a Reuters survey showed.
China’s onshore yuan finished Thursday’s domestic session at the strongest level since Sept. 1 and the central bank said it would cut the amount of cash banks must hold as reserves to support economic recovery.
Meanwhile, copper stocks in LME-registered warehouses are at the highest level since October 2022 after sharp growth over July-September.
In other metals, LME aluminium was up 0.8% at $2,236 a ton, tin rose 0.7% to $25,860, lead gained 0.6% to $2,231.5 and nickel jumped 1.8% to $20,430.
Zinc climbed 1.6% to $2,566 after touching $2,569 for its highest since Aug 1.
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