Copper prices pared losses in London and Shanghai on Thursday but markets may break higher if the dollar picks up downside momentum and the economic numbers continue to improve. The dollar resumed its weaker tone versus the euro after a modest blip higher off a year-low in the previous session but the outlook for the greenback, which traders say may slip to $1.50 against the single currency in the next month, would underpin commodities.
He added: "But to get through resistance we may need something more than currencies. People are talking about a pick-up in Western demand that will offset falls in Chinese imports that could send it up toward $7,000." After the Federal Reserve left rates on hold but said the economy was recovering, Thursday's data radar will be tuned to US existing home sales for August while on Friday the market will look out for new home sales and durable goods orders.
Three-month copper on the London Metal Exchange rose $9 to $6,135 a tonne by 0706 GMT, recovering from the previous session's 2.3 percent loss and off an early low of $6,085. Shanghai's benchmark third month ended 10 yuan down at 48,210 yuan having dipped as low as 47,560 yuan. China's refined copper imports fell 25 percent in August from the previous month, data on Tuesday showed, to 219,731 tonnes and well down from June's all-time high, but still the seventh highest inflow on record.