Home / Commodities / Commodity News / LME copper slips on Fed hike jitters; Shanghai nickel leaps to record

LME copper slips on Fed hike jitters; Shanghai nickel leaps to record

London copper prices slipped on Friday as risk sentiment soured with markets expecting the U.S. Federal Reserve to aggressively raise interest rates this year, although hopes of further policy support from China kept the metal on track for a weekly gain.

Dwindling inventories and optimism about demand prospect, however, pushed nickel higher, with the Shanghai benchmark price scaling a record peak for a second straight day.

Three-month copper on the London Metal Exchange was down 0.8% at $9,913.50 a tonne by 0705 GMT after a two-day advance.

An early rate hike from the U.S. central bank could trim liquidity in financial markets and slow recovery in the world’s biggest economy.

“A question for us is whether the Fed will signal the potential for a March rate rise,” ANZ analysts said in a note, as market participants anxiously await the Federal Open Market Committee’s two-day policy meeting starting Tuesday.

But copper, often used as a gauge of global economic health, was on track for a weekly gain of more than 2%, having been supported as well by supply concerns, low inventories at exchange warehouses, and a series of monetary easing measures in top consumer China.

Copper’s most-traded March contract on the Shanghai Futures Exchange ended daytime trading 0.6% higher at 71,290 yuan ($11,246.61) a tonne.

Shanghai nickel rose as much as 5.2% to a record 179,780 yuan a tonne.

London nickel rose 0.3% to $23,860 a tonne, rebounding from early losses. It touched $24,435 in the previous session, its highest since August 2011.

“The market is gearing up to face strong demand for key commodities as the world decarbonises, so higher risk premiums are likely for key commodities,” ANZ analysts said, including nickel which is used in electric vehicle batteries.

LME aluminium shed 1% to $3,080 a tonne, lead edged up 0.7% to $2,365, zinc dropped 0.4% to $3,634.50 and tin eased 0.6% to $43,220.

Shanghai aluminium fell 0.3% to 21,430 yuan a tonne, zinc rose 0.3% to 25,215 yuan, lead shed 0.1% to 15,675 yuan and tin gained 1.2% to 333,920 yuan.
Source: Reuters (Reporting by Eileen Soreng in Bengaluru; additional reporting by Enrico Dela Cruz in Manila; Editing by Sherry Jacob-Phillips and Subhranshu Sahu)

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping