LONDON: Copper prices in London hit their lowest in seven weeks on Tuesday, under pressure from a stronger dollar, rising inventories and weak indicators in top metals consumer China.
Three-month copper on the London Metal Exchange (LME) fell 2% to $9,698 per metric ton in official open-outcry trading after hitting $9,680, the lowest since April 23.
Copper, used in power and construction, touched a record high of $11,104.5 on May 20. “Chinese fabricator demand for copper remains soft as copper prices are still quite elevated despite a drop from record highs,” said Amelia Xiao Fu, head of commodity market strategy at Bank of China International.
China’s yuan fell against the US dollar to its lowest in nearly seven months as investors returned from a long weekend break to play catch-up with broad greenback strength in overseas markets. “There was an expectation that there would be buying when SHFE reopened after the Chinese holiday.
When there was no continuation of yesterday’s rally, it looks like a bit of long liquidation came into the market,” a trader said. Copper rose by 1.4% on Monday.
Further worsening the sentiment, iron ore futures in China fell to a two-month low on Tuesday amid concerns over demand prospects, while copper stocks in the LME-registered warehouses rose after 2,200 tons of inflows to 127,325 tons, the strongest in more than three months. LME aluminium eased 1.5% to $2,533 a ton in official activity after hitting $2,529, its lowest since May 14. Zinc fell 2.8% to $2,770, lead dropped 1.3% to $2,179, tin edged down 0.2% to $31,950, and nickel declined 0.2% to $17,850.
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