BEIJING: Copper prices slid on Wednesday as the dollar gained ahead of an interest rate decision by the US Federal Reserve due later in the day.
Three-month copper on the London Metal Exchange slid 0.7% to $8,294.50 per metric ton by 0744 GMT, while the most-traded January copper contract on the Shanghai Futures Exchange lost 0.3% to 67,810 yuan per ton.
The dollar index climbed following an unexpected rise in US consumer prices in November that added to expectation the Fed will not pivot to rate cuts early next year. A stronger dollar typically makes the greenback-priced metal more expensive to holders of other currencies. Also weighing on the metal market was demand outlook from top consumer China.
A readout from an agenda-setting meeting attended by top Chinese officials early this week failed to propose any large fiscal stimulus measures and lacked details, disappointing investors, ANZ analysts said in a note.
Copper is widely used in power, construction and transportation sectors and its consumption has been hit by China’s property woes. The winter season also sees less demand.
In China’s spot market, copper was traded at a discount against futures contract prices on Tuesday, the first time since September. Nevertheless, Rio Tinto’s chairman on Tuesday expressed optimism about China’s economic growth potential and said the global miner would stick to its long-term strategy there, according to state media. LME aluminium slipped 0.4% to $2,113.50 a ton, tin dipped 0.2% to $24,530, zinc shed 0.7% to $2,412.50, nickel fell 0.6% to $16,420, while lead was stable at $2,038.
SHFE aluminium eased 0.4% to 18,325 yuan a ton, zinc slipped 0.4% to 20,655 yuan, lead declined 0.2% to 15,545 yuan, nickel lost 0.7% to 130,400 yuan, while tin was little changed at 206,280 yuan.
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