Copper falls amid renewed concerns over China’s COVID-19 restrictions

Copper prices eased on Thursday as investors believed the easing of COVID-19 restrictions in China was modest and would continue to dampen demand as the dollar strengthens.

Three-month copper on the London Metal Exchange was down 1.4% at $8,180.50 a tonne at 11:00 GMT after losing 1% on Wednesday.

The metal hit near five-month highs on Monday after news that China, the world’s top metals consumer, had eased some COVID-19 restrictions and moved to shore up the country’s troubled real estate sector.

However, on Thursday, Chinese stocks fell after a spike in domestic COVID-19 cases renewed concerns about further lockdowns.

The most-traded copper contract as of December on the Shanghai Futures Exchange was down 0.3% at 66,510 yuan ($9,335.26) a tonne.

The market was also weighed on by a stronger dollar index, after strong US retail sales data cast doubt on market bets that inflation is cooling and the Federal Reserve could halt its aggressive path of rate hikes. interest rates.

Aggressive comments from Fed officials on Wednesday raised doubts about a change in monetary policy.

A higher dollar makes US-currency metals more expensive for holders of other currencies.

The LME’s benchmark copper spread, the gap between the spot and three-month contract, has widened its discount to $35 a tonne, the biggest in eight months.

LME nickel was down 2.5% at $26.845 a tonne after plunging 9% on Wednesday. Aluminum was down 0.8% at $2,393.50 a tonne, zinc was down 1.7% at $3,000.50, lead was down 0.5% at $2,159.50 and tin was down 2% at $23,175.

With information from Reuters