LONDON: Copper prices in London rose on Tuesday as the US dollar weakened after rallying on Monday, although concerns about economic growth in top metals consumer China and uncertainty about trade tariffs capped gains.
Three-month copper on the London Metal Exchange was up 0.8% at $9,063 per metric ton in official open-outcry trading after hitting $9,104, its highest since Nov. 21. Copper, used in power and construction, is down 10% in two months and has been trading in a tight range since mid-November as the market awaits developments in President-elect Donald Trump’s proposed import tariffs and possible retaliation from China.
“Base metals have come under increasing negative pressure since Trump’s victory in the US election, predominately due to US dollar strength, in addition to growing concerns over how deregulation and tariff implementation will impact western rate cuts and geopolitical tensions,” said StoneX analyst Natalie Scott-Gray. On Tuesday, China banned exports to the US of items related to gallium, germanium, antimony and superhard materials that have potential military applications, a day after Washington’s latest crackdown on China’s chip sector.
The dollar index was down on Tuesday, reflecting weakening that makes dollar-priced metals more attractive for buyers using other currencies. The correlation between copper and the US dollar movements has strengthened significantly since the US election and is likely to persist into 2025, Scott-Gray said.
In China, investors are awaiting the Central Economic Work Conference expected this month for any signs of additional monetary or fiscal stimulus after the country’s factory activity expanded modestly in November. The yuan slipped to the lowest level vs the dollar in over a year on Tuesday.
LME aluminium rose 0.4% to $2,601 a ton in official activity, zinc added 0.3% to $3,087, tin was up 0.4% at $28,700, nickel gained 1.8% to $15,980, while lead fell 0.7% to $2,061.
Source: Brecorder
