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The three-month copper price was at $9,652.50 per tonne, down from $9,720.50 per tonne at the close on December 31.
“At the macro level, the dollar keeps pushing higher. It rose by 0.6% on Monday after investors continued to reprice the faster quantitative tightening engineered by the US Federal Reserve in response to worrying inflation dynamics,” Fastmarkets analyst Boris Mikanikrezai said.
“Risk-taking appetite is poor. In China, the Shanghai Composite Index is down by 0.35% on the day. That said, we think that China has entered a policy-easing cycle, which could result in looser financial conditions and induce investors to build more risk. This would be indirectly positive for commodities such as copper.”
There was no trading on the LME yesterday due to a UK bank holiday, but Fastmarkets did report that MMG announced that the Las Bambas copper mine in Peru will once again be operating at full capacity starting on Monday.
Elsewhere in the base metals, the three-month aluminium prices continued to strengthen. It was the most traded metal on the LME, with 5,911 lots traded by 9:43am London time compared with just 3,751 lots of copper.
Aluminium prices remain supported by high energy prices and smelter cuts across Europe. The light metal’s three-month price was most recently trading $2,836 per tonne, up from $2,807 per tonne on December 31.
Available LME aluminium stocks also remain low, with 60,000 tonnes of aluminium freshly cancelled on Tuesday and a further 4,825 tonnes delivered out.
On-warrant aluminium stocks are now just 649,625 tonnes compared with 1,189,375 tonnes on this day in 2021.
“It is hard to get a clear picture in a world with ever more disruption to the supply chain, metals being seemingly endlessly withdrawn from LME warehouses yet there appears to be plenty of physical metal available that nobody wants to take,” Malcolm Freeman, chief executive officer at Kingdom Futures, said.
“All in all a very unclear picture and it seems the only certainly is volatility at the moment,” Freeman added.
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