SHANGHAI: Prices of most base metals in London edged lower on Thursday as the temporary U.S.-China tariff truce prompted caution, with concerns about a potential global recession affecting metals demand.
Benchmark copper on the London Metal Exchange (LME) fell 0.8% to $9,532 a metric ton on 0416 GMT.
On Wednesday, China paused some non-tariff measures taken in April against several U.S. entities - 17 on its unreliable entity list and 28 on its export control list, the commerce ministry said.
The two countries have agreed to reduce the tit-for-tat tariffs and implement a 90-day pause on actions, while Washington said it would cut the “de minimis” tariff for low-value shipments from China to 30%.
“The trade tariff conflict is moving in a positive direction, alleviating concerns about a global recession,” a trader said.
“However, trade negotiations are complex and lengthy, so we cannot confidently predict that things will return to normal after the 90-day truce. It’s possible that we might experience a situation similar to April, when heightened trade tensions negatively affected the outlook for metals.”
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Among other London metals, aluminium slid 0.3% to $2,520 a ton, zinc lost 0.3% to $2,755, lead fell 0.6% to $1,984 and nickel eased 0.6% to $15,775. Tin was flat at $32,815.
On the Shanghai Futures Exchange, most metals rose on growth in demand indicators, with China’s total social financing, a key measure of future industrial metals demand, up 8.7% in April, a 13-month high, driven by increased government bond issuance.
The most-traded copper contract on the Shanghai Futures Exchange (SHFE) fell 0.3% to 78,230 yuan ($10,851.76) per ton.
SHFE aluminium rose 0.8% to 20,315 yuan a ton, zinc gained 0.6% to 22,655 yuan, lead added 0.4% to 16,985 yuan, nickel price was flat at 124,450 yuan, and tin advanced 0.2% to 265,250 yuan.
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