LONDON: Copper fell on Friday as concern mounted over the recovery of some of the world's largest economies, but rising Chinese demand and low inventories kept prices on track for a weekly gain. Benchmark copper on the London Metal Exchange (LME) was down 1.7% at $6,492 a tonne at 1554 GMT. Copper is on track for a 2% rise this week.
"There is a continued risk-off sentiment on the macro-economic front which started yesterday," said ING analyst Wenyu Yao. "Despite this, the market has an overall positive view on copper as Chinese demand has been recovering well ... that is still in place despite the shock from headwinds recently."
The number of new US unemployment benefit claims unexpectedly rose back above 1 million last week. US Federal Reserve policymakers, meanwhile, have said more monetary policy easing may be needed to revive the world's largest economy. Data from France and Germany showed the European economies were struggling to recover from the impact of the coronavirus.
Copper stocks in LME warehouses were at a 13-year low of 103,475 tonnes. The lack of available metal has pushed the cash copper contract into a premium of about $18.50 over the three-month contract from a discount last week.
A surplus in the global lead market fell to 16,300 tonnes in June, from 45,300 tonnes in May, International Lead and Zinc Study Group (ILZSG) data showed. The global zinc market surplus narrowed to 2,000 tonnes in June, from 19,000 tonnes in May, ILZSG data showed.
LME aluminium fell 1.4% to $1,764 a tonne, after touching a seven-month high in the previous session. Zinc slipped 1.6% to $2,450, lead was down 1.1% to $1,973, tin rose 0.3% to $17,630 while nickel gained 0.3% $14,695.
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