LONDON: Copper prices vaulted to the highest level in six weeks on Friday as more rumours swirled about China loosening its strict COVID-19 measures while supply concerns still lingered.
Three-month copper on the London Metal Exchange (LME) shot up 4.4% to $7,895 a tonne by 1100 GMT after touching its highest since Sept. 13 at $7,918.
A former Chinese disease control official on Friday said that China will soon make substantial changes to its COVID-19 policy but did not give the basis for that information.
Other unverified reports emerged this week that top metals consumer China would move closer to the rest of the world in removing coronavirus curbs.
“Our China economist is very sceptical about these rumours. He reckons that, with the low level of vaccination, the government is not going to move any time soon,” said Caroline Bain, chief commodities economist at Capital Economics. Prices were also supported by the latest disruption to mine supply, with the huge Las Bambas copper mine in Peru saying on Thursday that it had begun to reduce operations because of recent blockades. “Chile’s copper output was down 4% in September, so everything on the supply side is really supportive for prices and exchange stocks are also very low,” Bain said.
Copper stocks in LME warehouse dropped by 5,375 tonnes on Friday to 88,600 tonnes, the lowest in more than seven months. Copper inventories in warehouses monitored by SHFE fell 6.9% week on week to 59,064 tonnes on Friday.
Traders will eye the US payrolls report, due at 1230 GMT, with any upside surprise likely to reinforce the Fed’s hawkish outlook, analysts said. Economists polled by Reuters expect non-farm payrolls to have increased by 200,000 jobs in October. Among other metals, LME aluminium gained 2.3% to $2,317 a tonne, zinc jumped 4.6% to $2,845, lead added 0.6% to $2,007, nickel climbed 3.1% to $23,500 and tin was up 2.1% at $18,130.
Comments
Comments are closed for this article.