Copper prices in London fell from a nearly one-month high on Monday, as tepid physical demand improvement in China and caution ahead of the US Federal Reserve’s rate decision weighed on sentiment.
Three-month copper on the London Metal Exchange fell 0.9% to $8,300 per metric ton by 0414 GMT, while the most-traded July copper contract on the Shanghai Futures Exchange eased 0.1% to 66,800 yuan ($9,353.65) per metric ton.
Copper prices registered their second weekly gain by the end of last week, hitting $8,451 per metric ton, their highest since May 11 on falling inventories, rate cuts and stimulus hopes in top global metals consumer China.
Strong growth in China’s renewable energy and the automobile sectors, both of which consume copper, also lent support. But Jinrui Futures said the recent rebound in prices might encourage scrap supply, while downstream physical consumption had not improved significantly, limiting upside in future price rebounds.
Copper heads for second weekly gain as stocks improve sentiment
“If the risk of overseas recession and other liquidity risks further ferment, … it is not recommended to bargain hunt,” Jinrui added.
The dollar edged up but was still near multi-week lows against some of its major peers as traders were on guard ahead of crucial central bank meetings this week, including the Fed.
A firmer dollar makes greenback-priced metals more expensive to holders of other currencies.
LME aluminium shed 1% to $2,245 per metric ton, nickel declined 0.7% to $21,030, zinc dropped 1.6% to $2,365.50, lead eased 0.3% to $2,050 while tin lost 2.5% to $25,840.
SHFE aluminium fell 0.6% to 18,240 yuan per metric ton, zinc declined 0.7% to 19,750 yuan, tin shed 0.9% to 209,470 yuan, while nickel rose 2% to 163,100 yuan and lead advanced 0.6% to 15,255 yuan.
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