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Copper rises on weaker dollar, but slowdown worries weigh

Copper prices rose on Tuesday, as a softer dollar made the greenback-priced metal cheaper to holders of other currencies, although concerns over a global slowdown checked the gains.

Three-month copper on the London Metal Exchange CMCU3 rose 0.4% to $7,365 a tonne by 0611 GMT, while the most-traded October copper contract on the Shanghai Futures Exchange SCFcv1 edged up 0.2% to 61,180 yuan ($8,546.96) a tonne.

The dollar .DXY fell after scaling a two-decade peak on Monday amid tightening monetary policy in the United States.

As central banks across the globe hike interest rates aggressively to bring down persistently high inflation, the economic growth outlook has weakened, dampening demand for metals.

LME copper inventories MCUSTX-TOTAL rose to 129,000 tonnes, their highest since Aug. 15.

China’s top copper smelters lifted their floor treatment and refining charges for the fourth quarter of 2022 to a five-year high, as rising concentrate supply is expected to outpace the expansion in smelting capacity.

Fitch Solutions revised down its 2022 copper price forecast to $8,800 a tonne from $9,470 due to an elevated dollar and weaker global demand.

“We forecast global copper consumption growth to fall slightly in 2022… amid a worsening macroeconomic outlook, lower industrial production in China and high levels of global inflation,” it said in a report.

Meanwhile, copper inventories in China bonded warehouses SMM-CUR-BON depleted further and were last at a record low of 81,800 tonnes.

LME aluminium CMAL3 fell 0.1% to $2,137.50 a tonne, while lead CMPB3 rose 0.7% to $1,767.50 a tonne.

ShFE aluminium SAFcv1 declined 1% to 18,220 yuan a tonne, nickel SNIcv1 was down 0.7% at 187,470 yuan a tonne, zinc SZNcv1 decreased 0.7% to 24,325 yuan a tonne and tin SSNcv1 rose 4% to 178,020 yuan a tonne.
Source: Reuters (Reporting by Mai Nguyen in Hanoi; Editing by Rashmi Aich and Subhranshu Sahu)

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