BENGALURU: London copper prices eased on their way to a fifth straight weekly dip on Friday, as the US dollar gathered momentum on markets pricing in more interest rate hikes this year with a resolution to the US debt ceiling debate in sight.
Three-month copper on the London Metal Exchange dipped 0.2% to $8,157.50 a tonne by 0220 GMT, holding near this week’s 5-1/2-month lows.
The most-traded copper contract on the Shanghai Futures Exchange fell 0.5% to 65,260 yuan ($9,441.41) a tonne.
The US dollar firmed near two-month highs on hopes that US President Joe Biden and House of Representatives Speaker Kevin McCarthy would finalize a deal on the debt ceiling as soon as Sunday.
A stronger dollar cuts demand for commodities priced in the US currency, which further got a boost from hawkish commentary from Federal Reserve policymakers arguing that inflation is not cooling fast enough yet to allow the Fed to pause rate hikes.
In other metals, LME aluminium lost 0.5% to $2,272.50 a tonne, nickel was flat at $20,955, zinc slipped 0.4% to $2,448.50, tin added 0.1% to $24,955, while lead gained 0.2% to $2,058.50.
Refined zinc prices are expected to be on a downward trend until 2025, as weak demand growth failed to match with a surge in production, analysts said. Zinc prices have slipped to their lowest since October 2020.
Copper prices down, hit by strong dollar, rising inventories
The global zinc market surplus climbed to 26,700 tonnes in March, while global lead market deficit widened to 21,000 tonnes, data from the International Lead and Zinc Study Group showed on Thursday.
The global nickel market had a surplus of 6,600 tonnes in March, data from the International Nickel Study Group showed.
Commodity trader Trafigura has earmarked for delivery unusually large volumes of aluminium at London Metal Exchange (LME) approved warehouses in Malaysia, two sources with direct knowledge of the matter said, raising exchange supply concerns.
China’s aluminium imports in April rose 27.1% from a year earlier, customs data showed on Thursday, with domestic supply constrained by lingering power issues in the southwest.
Comments
Comments are closed.