Shanghai Futures Exchange copper slid 1.2 percent to 42,580 yuan ($6,859) a tonne on Monday as jitters intensified over a potential Greek debt default, which combined with a looming summer slowdown to sour sentiment towards metals. The Greek government is sticking to demands that its creditors propose less harsh terms for a cash-for-reforms deal after talks collapsed, bringing Athens one step closer to a default that could tip it out of the euro zone.
"We have maintained our view that growth in China is going to continue to moderate. We're not really seeing anything to suggest we're going to see a big rally in prices towards the end of the year." Supply remains ample. China's output of refined copper jumped 8.1 percent in May, hitting the highest this year as strong fees prompted some smelters to produce more. Bonded copper premiums dropped to $65 last week from as high as $85 in early May.
Potentially offering a boost to demand, China will pledge a multi-billion dollar investment in Europe's new infrastructure fund at a summit in June in Brussels. Investors increasingly expect copper prices to fall. Hedge funds and money managers switched to a net short position in the latest week, US data showed.
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