BEIJING: Copper prices climbed on Friday as investors hoped that China’s efforts to bolster its economy will improve demand for metals, although the gains were limited by a stronger dollar and near-term worries around surging COVID-19 cases in the country.
Three-month copper on the London Metal Exchange (LME) was up 0.3% at $8,396 a tonne by 0147 GMT, while the most-traded February copper contract on the Shanghai Futures Exchange rose 1.5% to 65,060 yuan ($9,460.25) a tonne.
Economists and analysts believe policymakers in China will roll out more support measures to stimulate demand this year, as part of Beijing’s overall goal to bolster the $17 trillion economy after a sharp COVID-induced downturn.
The likely modest demand recovery in property is likely to propel demand for industrial metals.
The sentiment was also buoyed by news that China will reopen to the world on Sunday, welcoming international travellers and returning residents without the need to quarantine for the first time since 2020.
Traders are also eyeing U.S. jobs reports due at 1330 GMT.
The dollar index hit a four-week high on Thursday after data pointed to a strong jobs market, supporting the prospect that the Federal Reserve could keep up the pace of aggressive rate hikes.
Demand angst puts copper on track for largest drop since 2018
Meanwhile, global copper smelting activity dipped in December as smelters shut for maintenance after a year of sluggish activity, data from satellite surveillance of metal processing plants showed on Thursday.
On the output front, Chile’s total copper production fell 6.9% in November to 449,000 tonnes, government body Cochilco said on Thursday.
In other developments in the sector, the LME said Gay Huey Evans will step down as LME chair, but declined to comment on whether it was due to regulatory reviews into the nickel market events in March.
PRICES: LME aluminium gained 0.5% to $2,266 a tonne, lead added 0.4% to $2,226, tin was up 0.3% to $24,940.
SHFE aluminium dipped 0.2% at 17,770 yuan a tonne, zinc was up 0.4% at 23,210 yuan, tin lost 2.5% at 202,110 yuan, and nickel shed 6.7% at 208,840 yuan.