METALS-Copper prices near 10-week low as Fed rate view lifts dollar
(Updates prices, adds details and quotes)
HANOI, June 21 (Reuters) – Copper prices dropped to their lowest in nearly 10 weeks on Monday, as the dollar strengthened amid prospects of sooner-than-expected U.S. policy tightening, making greenback-priced metals more expensive to holders of other currencies.
Three-month copper on the London Metal Exchange fell to its lowest since April 15, following an 8.6% drop last week, the biggest weekly fall since March 2020.
The most-traded July copper contract on the Shanghai Futures Exchange shed as much as 2% to its lowest since April 14 of 66,480 yuan ($10,277.98) a tonne.
The dollar held near multi-month peaks against other major currencies, after the U.S. Federal Reserve signalled it would raise interest rates and end emergency bond-buying sooner than expected.
“The headwinds coming from a stronger USD and further measures such as the release of metal from strategic Chinese reserves are likely to keep downward pressure on the base metals sector,” said ANZ analysts in a note, referring to a Chinese state sale plan announced last week.
“This is likely to test the nerve of bullish investors, who had been banking on new growth sectors driven by the acceleration of the decarbonisation trend,” analysts said.
* Last month, China’s copper exports rose to their highest level since March 2020 due to higher international prices.
* LME nickel rose 1.3% to $17,375 a tonne, as of 0454 GMT, and ShFE nickel advanced 1.4% to 129,780 yuan a tonne amid strong Chinese demand and near record-low ShFE inventories NI-STX-SGH.
* ShFE zinc dropped as much as 3.2% to 21,390 yuan a tonne, its lowest since April 23, while ShFE lead rose 1.8% to 15,415 a tonne.
* China’s refined lead imports dropped 98.7% year-on-year to 21 tonnes in May. ShFE lead inventories PB-STX-SGH were hovering near their highest since 2013.
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