6 days ago
- Business
- Business Recorder
Copper lifted by rate cut hopes, Chile supply worries
LONDON: Copper prices edged higher on Wednesday, supported by hopes for U.S. rate cuts and persistent supply concerns following the suspension of a mine in top producer Chile.
Three-month copper on the London Metal Exchange was up 0.4% at $9,677 per metric ton by 0930 GMT after slipping by 0.6% in the previous session.
'A weaker dollar as Fed rate cuts bets intensify is buoying metals this morning,' said Ewa Manthey, commodities strategist at ING.
Following weak U.S. jobs data on Friday, traders are pricing in an 86.5% chance of a Fed rate cut in September, with about 56 basis points worth of easing expected by year-end.
Investors are also eyeing developments in Chile, the world's largest copper producer, after the collapse at its El Teniente copper mine that killed six people due to a tremor last week.
Miner Codelco must produce four reports before it can restart its underground operations at the mine, which produced 356,000 tons of copper last year.
Copper climbs on supply disruptions after Chile tragedy
'It has been a mixed picture. Copper has been holding well throughout this week. Of course, the Codelco news got the micro story bringing some support to prices,' said research analyst Yuting Du at broker Marex.
At the same time, some investors are placing bets on lower prices through puts in the option market, Du added.
The most-traded copper contract on the Shanghai Futures Exchange lost 0.3% to 78,280 yuan ($10,889.01) a ton.
Also helping the market were hopes for easing in a U.S.-China trade war after President Donald Trump said they were close to a trade deal with China, the world's biggest metals consumer.
Among other metals, LME aluminium rose 0.6% to $2,577 a ton, zinc climbed 0.5% to $2,773, nickel advanced 0.6% to $15,120, lead gained 1% to $1,993.50 and tin added 0.7% to $33,485.
