NEW DELHI: Shanghai copper prices hit a more than one-week high on Monday, tracking some weakness in the dollar, after the US central bank chief signalled a possible rate cut next month and as demand in top metals consumer China remained upbeat.
The most-traded copper contract on the Shanghai Futures Exchange ended daytime trade up 1.25 percent at 79,690 yuan (USD11,141.56) per metric ton, the highest since 24 July.
The dollar attempted to pull itself up from a four-week low on the euro after a dovish pivot from Federal Reserve Chair Jerome Powell sent it tumbling more than 1 percent on Friday.
Copper prices drew support after Powell pointed to a possible rate cut at the central bank’s September meeting but stopped short of committing to reducing interest rates.
“A lower interest rate environment typically stimulates economic activity, thereby boosting demand for copper in infrastructure, manufacturing, and energy transition projects,” said Sugandha Sachdeva, founder, SS WealthStreet, a New Delhi-based research firm. Hopes of stronger seasonal demand in top consumer China lingered and helped prices of the red metal used in power and construction sectors.
Among other metals, SHFE aluminium added 0.48 percent, nickel was up 0.59 percent, tin firmed 1.22 percent and zinc gained 0.67 percent, while lead advanced 0.51 percent. The London Metal Exchange was shut on Monday for Summer Bank holiday.