NEW DELHI: Copper prices in London hit a near three-week high on Wednesday following US President Donald Trump’s comments about a trade deal with China, signalling a de-escalation in tensions, but a stronger dollar limited sharper gains.
The benchmark three-month copper on the London Metal Exchange (LME) was up 0.4% at $9,409.5 per metric ton, as of 0341 GMT.
It briefly hit $9,481.5 per metric ton, the highest since April 3.
The most-traded copper contract on the Shanghai Futures Exchange (SHFE) rose 1.07% to 77,770 yuan ($10,651.24) per metric ton.
Trump also told reporters he would be very nice in negotiations with Beijing and that tariffs on imports from the country would fall significantly following a deal, but not to zero.
“Comments from Trump suggesting a reduction in China tariffs leave room for de-escalation on the trade front,” ING analysts said.
Aiding sentiment on Wednesday were comments from US Treasury Secretary Scott Bessent that also suggested a possible de-escalation in US-China trade tensions.
Meanwhile, the US dollar rose sharply and then steadied on Wednesday as Trump backed away from threats of firing Federal Reserve Chair and optimism around trade deals lifted sentiment.
Copper rallies to one-month peak on signs of improving demand
A stronger dollar makes commodities priced in the US currency costlier for buyers using other currencies.
“Ultimately, a sustained recovery in risk assets, as well as the US dollar, relies, realistically, on deals being done between the US and its major trading partners, especially China, and a major watering down of trade policies,” said Kyle Rodda, senior financial market analyst at Capital.com.
Among other metals, LME aluminium added 1.09% to $2,406 a ton, lead rose 0.4% to $1,931, tin was up 0.5% at $31,275, zinc was up 1.1% to $2,624.5, and nickel firmed 0.2% at $15,720 a ton.
SHFE aluminium firmed 0.3% to 19,810 yuan a ton, zinc added 0.8% to 22,420 yuan, lead eased 0.4% to 16,895 yuan, while nickel was up 0.2% at 125,770 yuan, tin fell 0.08% to 258,670 yuan.
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