NEW DELHI: Copper prices rose marginally on Wednesday, lifted by a weaker US dollar, although a possible surge in COVID-19 infections in Beijing posed short-term risks and kept gains in check.
Three-month copper on the London Metal Exchange was up 0.08% at $8,504 a tonne by 0441 GMT, after having hit its highest since June 23, at $8,629, in the previous trading session.
The most-traded January copper contract on the Shanghai Futures Exchange was up 0.65% at 66,340 yuan ($9,532.43) a tonne.
The dollar weakened after data showed US consumer price inflation rose less than expected last month, strengthening the view that the Federal Reserve will slow its pace of rate hikes after its two-day meeting on Wednesday.
“(A) weakening USD is another tailwind at the moment,” said Soni Kumari, a commodity strategist at ANZ Research.
Meanwhile, a week after China began dismantling its tough zero-COVID controls, the World Health Organization warned of “very tough” times ahead and state media reported on seriously ill patients at hospitals in Beijing, raising fears of a wave of infections.
“We remain cautious as this surprised reopening during winter could lead to rapid spread of infections through households and offices,” Kumari said, adding that this remained a short-term risk for recovery in industrial activity. “Falling copper spot premium still suggests weaker demand.”
Copper retreats on worries over China demand
Among other metals, LME aluminium was down 0.24% at $2,455 a tonne, while zinc was down 0.05% at $3,317, and lead weakened 0.7% to $2,190.
SHFE aluminium rose 0.4% to 18,775 yuan a tonne, tin climbed 0.62% to 195,400 yuan, zinc dipped 0.4% to 24,785 yuan, nickel fell 2.05% to 218,060 yuan, while lead was down 0.45% to 15,545 yuan.