LONDON: Copper and aluminium prices fell to a two-week low in London on Friday as hawkish comments from US Federal Reserve Chair Jerome Powell dashed expectations of a peak in interest rates and as exchange stocks rose.
Three-month copper on the London Metal Exchange (LME) was down 1.3% at $8,045 per metric ton by 1702 GMT, after touching $8,021, it lowest since Oct. 27.
Aluminium fell 1.2% to $2,216 a ton, after also hitting its weakest since Oct. 27 at $2,209.5. Fed officials including Powell on Thursday expressed uncertainty in their battle against inflation and said they would tighten policy further if need be.
Next week, the growth-dependent metals market will focus on the release of China’s October aggregate financing data, including total social financing (TSF), which has a strong relation to demand in the top metals consuming country.
“Last month, we saw an extraordinarily high number indicating stimulus activity is working. If that cadence can be maintained, that could be a boost for metals,” Nitesh Shah at WisdomTree said.
The dollar index rose slightly after data showed US consumer sentiment fell for a fourth straight month. A strong US currency makes dollar-priced metals more expensive for buyers using other currencies.
Copper and aluminium stocks in LME-registered warehouses rebounded after arrivals, daily LME data showed. Aluminium inventories in warehouses monitored by the Shanghai Futures Exchange rose by 10% this week, but copper stocks fell by 14%, the exchange said.
Nickel was last down 3.3% at $17,220, after hitting its lowest since mid-2021 at $17,210. Sizeable output cuts will help support nickel prices, which are likely to have reached a bottom after a year-long slide, but tighter supplies are not expected to eliminate surpluses. Zinc fell 1.9% to $2,554, lead dropped 0.5% to $2,178.5 and tin was down 1.0% at $24,580.
In major tin miner Myanmar, a rebel alliance has overrun areas bordering China, with resistance to the military junta gaining its most significant win since the 2021 coup. Beijing urged all parties to stop fighting immediately.