LONDON: Copper prices in London rose on Thursday, supported by the dollar weakening ahead of U.S. inflation data and persisting hopes of further Chinese stimulus measures.
Three-month copper on the London Metal Exchange (LME) advanced 0.6% to $8,445.5 per metric ton by 0941 GMT.
Copper, used in power and construction, is heading for a second consecutive weekly fall, pressured by patchy post-pandemic recovery in top metals consumer China.
Data on Wednesday showed deflation in consumer prices and further declines for factory gate prices in China, adding to hopes that Beijing would boost policy stimulus.
“Most industrial metals remain dependent on economic stimulus from China. If China introduces stimulus measures, in particular for the property sector, this will boost metals demand and support higher prices,” said ING analyst Ewa Manthey.
“In the near term, we believe base metals prices will remain volatile as the market’s focus will stay on the bigger macroeconomic picture, with flagging global growth weighing on demand.”
Copper bounces on stimulus bets after China sinks into deflation
The dollar index softened ahead of U.S. inflation data due that will shape Federal Reserve interest rate policy. A weaker U.S. currency makes dollar-priced commodities more attractive for buyers holding other currencies.
On a technical front, resistance for copper is coming from 50-day moving average at $8,459.
Zinc fell 0.8% to $2,460 as inventories in LME-registered warehouses paused their August decline. On-warrant stocks rose to a three-week high of 71,525 metric tons, daily LME data showed.
The discount on the LME cash contract to three-month zinc swung to a premium in early August in a sign of tighter near-term supply in the LME system. The premium was at $36.50 a ton at Wednesday’s market close for its highest since Feb. 20.
LME aluminium rose 0.7% to $2,211 a ton, lead was up 0.3% at $2,133 while tin fell 1.5% to $26,865 and nickel lost 0.2% to $20,515.
Comments
Comments are closed.