Base metals supported by weaker dollar ahead of U.S. jobs report

Copper and most other base metals continued to find support from a weaker U.S. dollar on Friday, amid expectations of slower job growth in July in the United States ahead of a closely watched employment report due later in the day.

Three-month copper on the London Metal Exchange CMCU3 rose 0.9% to $7,799.50 a tonne as of 0521 GMT.

Copper prices recorded a three-day loss earlier this week on weak global factory data and flaring U.S.-China tensions following U.S. House of Representatives Speaker Nancy Pelosi’s visit to Taiwan.

The recent rebound was primarily attributed to technical buying and a weaker dollar on signs of a softening labour market.

A weaker dollar translates to cheaper costs for commodity buyers using other currencies.

However, overall sentiment remained bearish with concerns over a prolonged interest rate hike by the U.S. Federal Reserve and near-term demand outlook in China, the world’s top metals consumer.

“With the likelihood of Fed raising rate by 50 to 75 basis points hanging on the table, participants are looking to eliminate their risk exposure to current price volatility,” He Tianyu, a copper analyst at CRU Group, said.

The most-traded September copper contract on the Shanghai Futures Exchange SCFcv1 advanced 1.3% to 60,170 yuan ($8,919.23) a tonne.

LME tin CMSN3 gained 0.6% to $24,695 a tonne, zinc CMZN3 rose 1% to $3,484 a tonne, aluminium CMAL3 nudged up 0.4% to $2,411.50 a tonne, while lead CMPB3 steadied at $2,046.50 a tonne.

ShFE zinc SZNcv1 jumped 4% to 24,595 yuan a tonne, nickel SNIcv1 climbed 2.9% to 178,000 yuan, tin SSNcv1 rose 2.4% to 197,870 yuan a tonne, and aluminium SAFcv1 was up 1.9% to 18,535 yuan a tonne.
Source: Reuters (Reporting by Siyi Liu and Emily Chow, Additional reporting by Eric Onstad; Editing by Rashmi Aich and Shounak Dasgupta)