Copper slips as macro concerns, firmer dollar weigh

Copper prices fell on Monday, weighed down by a slightly firmer dollar, fading hopes for another Federal Reserve rate cut and a host of macro concerns.

Benchmark three-month copper on the London Metal Exchange was down 0.5% at $10,802.50 per metric ton in official open outcry trading. The metal used in power, construction and manufacturing is considered a bellwether for the health of the global economy.

“There is little change to the underlying narrative in base metals … with the market largely defined by muted activity as participants wait for delayed U.S. economic data and clarity on monetary policy,” Neil Welsh, head of metals at Britannia Global Markets, said in a note.

The dollar index nudged up 0.2%. A stronger dollar makes dollar-denominated metals more expensive for investors using other currencies.

Sentiment also continues to be held back by macro signals from top metals consumer China, where recent industrial data has been lacklustre even as major infrastructure and green energy investments support long-term demand for industrial metals.

“It’s all macro-related,” Panmure Liberum analyst Tom Price said of copper’s decline. “If you look across the copper signals, price actions are high and restricted to a tight range and all the other signals look like they are deteriorating.”

Copper falls as weak Chinese data raises demand concerns

The cash LME copper contract last traded at an $18-a-ton discount to the three-month forward, indicating no pressing need for short-term metal.

In zinc, however, the cash contract was commanding a $208.50 premium, underscoring supply tightness amid low LME stocks of less than 40,000 tons.

Zinc was the only LME metal in positive territory on Monday, adding 0.1% to $3,023 a ton, with broker Marex noting that the metal used to galvanise steel was also being supported by ferrous prices.

Aluminium fell 0.9% to $2,833, nickel shed 1% to $14,740, after hitting its lowest since April, tin slipped 0.1% to $36,750, and lead dropped 0.7% to $2,050 after 42,025 tons of lead deliveries into Kaohsiung.