Industrial metals soar after China eases measures against COVID-19

Industrial metal prices rose sharply on Friday after China eased some coronavirus rules, fueling expectations it will abandon a zero-COVID policy that has dampened economic activity and demand for metals.

Metal prices had already risen on Thursday after softer-than-expected US inflation data suggested the Federal Reserve may taper interest rate hikes.

The news gave hope that the main restrictions on economic growth could be less severe than feared in the coming months.

Global stock markets rose and the dollar weakened sharply, giving dollar-priced metals a boost by making them cheaper for buyers with other currencies.

Benchmark copper on the London Metal Exchange (LME) was up 2.2% at $8,456.50 a tonne by 11:54 GMT.

Prices of the metal used in energy and construction have risen 13% this month on hopes of a revival in Chinese demand, but are still down more than 20% from the peak reached in March due to weak activity. economic.

“The situation has changed significantly… prospects have improved”, said a commodity market analyst in Germany, adding that copper should hit $9,000 by the end of the year.

He said low inventories would also support prices and speculative investors who have been neutral or bearish on copper could lift prices sharply if they turn bullish.

In other metals, LME aluminum rose 4.1% to $2,423 a tonne, zinc rose 5.4% to $3,039.50, nickel gained 3.1% to $26,750, lead rose 3.4% to $2,170. and tin rose 3.2% to $20,965.

With information from Reuters