LONDON: Copper prices hovered around a six-week low on Thursday, weighed down by uncertainty over interest rate cuts and patchy economic recovery in top metals consumer China.
Three-month copper on the London Metal Exchange (LME) was up 0.1% at $8,276 a metric ton in official open-outcry trading. It dipped to $8,258 a ton on Wednesday for its lowest since Dec. 7.
The industrial metal is on track for its fourth straight week of losses. “In late 2023 there was bullish sentiment supported by rate cut expectations and the market priced that in,” said Dan Smith, head of research at Amalgamated Metal Trading.
“At the start of this year there has been a setback, with inflation in the US and United Kingdom still quite high and Chinese data not helping.”
Data on Wednesday showed China missed forecasts for economic growth while sales in the debt-heavy property sector continued to decline.
“The Chinese property market is big drag on the economy, but not so much on base metals demand,” Smith added. China’s aluminium imports rose by 28% year on year to 3.1 million tonnes in 2023 thanks to robust demand.
Aluminium last traded at $2,175 a ton, down 0.14%. It had earlier slipped to $2,173.50 for its lowest since Dec. 14.
LME aluminium stocks have jumped by 25% since Dec. 14, indicating healthy supplies of the metal widely used in construction and transportation.
The dollar index is largely stable after reaching a one-month peak against major peers. A stronger US currency makes dollar-priced metals more expensive for buyers using other currencies. In other metals, LME zinc lost 0.5% to $2,453 a ton, nickel gained 0.4% to $16,135, tin rose 0.5% to $25,350 and lead was down 0.2% at $2,060.
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