LONDON: Copper jumped to 2-1/2-week highs on Wednesday as the dollar tumbled after US June inflation data and stronger credit data from top consumer China, but doubts about a significant pick-up in demand weighed on sentiment.
Benchmark copper on the London Metal Exchange (LME) was up 2.2% at $8,509 a metric ton at 1612 GMT from an earlier $8,525, the highest since June 23.
The dollar index dropped to its lowest since April 2022 after data showed consumer price inflation easing in June, suggesting that the Federal Reserve may have to raise interest rates just one more time this year.
A falling US currency makes dollar-denominated metals cheaper for holders of other currencies, which could boost demand. This relationship is used by funds which generate buy and sell signals using numerical models.
“Momentum came after the New York open from soft US inflation numbers,” a metals trader said. “China loan data helped support the base complex this morning but there are question marks over Chinese demand.”
New bank loans in China jumped more than expected in June, and total social financing data watched by analysts for clues to industrial metals consumption exceeded expectations.
Also on the agenda this week is China trade data and its housing market, which accounts for significant amounts of industrial metals demand.
In other metals, aluminium rose 3.3% to $2,240 a metric ton, zinc added 3.1% to $2,430, lead gained 1.8% to $2,089, tin advanced 3.9% to $29,050 and nickel climbed 5% to $21,745.
Comments
Comments are closed for this article.