LONDON: Copper prices retreated on Friday, weighed down by a firmer dollar ahead of U.S. jobs data and persistent worries about weak demand in top metals consumer China.
Three-month copper on the London Metal Exchange was down 1% at $8,525 per metric ton by 1015 GMT after rising 1.2% on Thursday.
The dollar index climbed ahead of the closely-watched U.S. nonfarm payrolls report due at 1230 GMT, which is expected to show a tight labor market.
A firm dollar makes commodities priced in the U.S. currency more expensive for buyers using other currencies.
“Some bulls continue to back the dollar index, so that is weighing on copper prices,” said Naeem Aslam, chief investment officer at Zaye Capital Markets.
Tin bounces on Myanmar mining ban, others drift lower
“On the Chinese front, the PMIs are in contractionary territory, so that is also causing pressure on metals prices.”
China is expected to roll out further support to boost economic growth, especially in the property and infrastructure sectors, both major consumers of industrial metals, but a series of announcements in recent weeks have offered few details.
Aslam said worries about a U.S. recession were overblown, highlighted by strong results from Amazon overnight.
“We believe we will see robust and sustainable growth in copper demand so the current weakness in prices is an opportunity to buy.”
There was one bright area in Chinese demand with new orders from the power sector expected to lift operation rates for copper cable and wire producers to 86.8% in August from 84.8% in July, according to the Shanghai Metals Market.
But demand from other copper-related sectors stayed tepid, offsetting some supply tightness in the market, it added.
LME tin slipped 0.8% to $27,800 a metric ton, pulling back from previous gains driven by a mining ban in third-largest tin miner Myanmar.
Among other metals, aluminium shed 1% to $2,208 a ton, zinc dipped 0.1% to $2,481.50, nickel shed 0.9% to $21,420 and lead fell 0.8% to $2,139.
Comments
Comments are closed for this article.