Copper heads for worst weekly loss in a year, tin sinks

Copper prices posted their biggest weekly drop in a year on Friday, down more than 7% cumulatively, as investors fear central bank efforts to curb inflation will curb global economic growth and dampen demand. of metals.

Other industrial metals also tumbled, with nickel down 13% so far this week and tin down 25%, their biggest weekly drop since at least 2005.

“There is a risk of further losses”said independent analyst Robin Bhar. “It seems that a strong economic slowdown or a recession is coming”.

Three-month copper on the London Metal Exchange (LME) was down 1.26% at $8,305.50 a tonne at 11:33 GMT, after touching $8,220, down almost 25% from the maximum reached in March and its lowest level since February 2021.

Bhar said copper, used in energy and construction, could fall towards its cost of production, around $7,000-$7,500, although tight supply and rising demand for its use in electrification later in the decade they will raise prices.

The head of the United States Federal Reserve, Jerome Powell, said this week that the entity will curb inflation, which is at the highest level in the last 40 years, even if this increases unemployment and poses a risk of economic slowdown. .

Growth in the global manufacturing sector is slowing, in part due to restrictions imposed to curb the spread of the coronavirus in top producer China.

In other base metals, tin on the LME fell 13.7% to $23,285 a tonne. Prices are down more than 50% from the peak reached in March. Nickel fell 7% to $22,365 a tonne, hitting its lowest level in five months.

Aluminum was down 0.6% at $2,463.50, and was down more than 1% for the week; zinc fell 2.4% to US$3,409.50 and fell nearly 3% for the week; and lead fell 1.6% to $1,915.50 and headed for a 7% weekly loss.