(Updates with official prices)<\/p>\n
LONDON, Nov 17 (Reuters) – Copper prices fell for a third day on Wednesday as expectations of U.S. interest rate rises lifted the dollar to 16-month highs, making metals priced in the greenback costlier for buyers with other currencies.<\/p>\n
Benchmark copper on the London Metal Exchange (LME) was down 0.7% at $9,490 a tonne in official trading.<\/p>\n
Prices of the metal used in construction and to conduct electricity hit a record high of $10,747.50 in May but have since lost momentum as economic growth slowed.<\/p>\n
The dollar was steady on Wednesday but has surged in the last week as strong U.S. economic data and high inflation lead many investors to expect a U.S. rate hike as early as mid-2022.<\/p>\n
That has dragged copper towards its 200-day moving average, a key technical indicator currently at $9,408 a tonne, said Saxo Bank strategist Ole Hansen.<\/p>\n
\u201cIf we close below that level, we could see the market reverse down to $9,000,\u201d he said, but added that prices were unlikely to fall far because demand will rise as the world builds infrastructure for electrification.<\/p>\n
DEMAND: The world will need to double its copper supply and quadruple its nickel supply in the next 30 years to facilitate a decarbonised world, an executive at miner BHP said.<\/p>\n
SPREAD: A supply squeeze on the LME that pushed prices up last month has faded, with copper moving into exchange warehouses and the premium for cash copper over the three-month contract falling to $13.50 a tonne from over $1,100 last month. <\/span>CMCU0-3<\/span>MCUSTX-TOTAL<\/span><\/p>\n CHINA COAL: Chinese coal prices continued to plummet as Chinese mines ramp up production. Cheaper coal should reduce energy costs for metal smelters.<\/p>\n ALUMINIUM: Electricity costs are most important for aluminium, the production of which uses huge amounts of power. Shanghai aluminium prices fell sharply. On the LME, aluminium was up 1.8% at $2,621.50 a tonne but still nearly 20% down from its peak last month.<\/p>\n CHINA OUTPUT: In October, China\u2019s copper output fell 0.3% year-on-year, zinc output fell 9.2% and alumina production fell to a 10-month low, official data show.<\/p>\n METALS PRICES: LME zinc fell 0.3% to $3,214.50 a tonne, nickel rose 0.3% to $19,450, lead slipped 1.2% to $2,280 and tin was up 0.4% at $37,800.<\/p>\n