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Copper and aluminum fall due to dollar strength and uncertainty about China

Copper and aluminum fall due to dollar strength and uncertainty about China

Copper and aluminum fall due to dollar strength and uncertainty about China

Copper and aluminum prices fell on Tuesday, pressured by the strength of the dollar and uncertainty about the easing of restrictions on COVID-19 in China, the main consumer of the metal.

Three-month copper on the London Metal Exchange was down 0.1% at $8,383 a tonne as of 11:00 GMT, while aluminum was down 1.3% at $2,491.

Copper is up 12% this month, largely on hopes that demand for the metals will improve as China eases tough COVID restrictions that have depressed economic growth.

In Beijing, the Chinese capital, the need to test negative for COVID to enter supermarkets and offices has been removed, marking the latest relaxation of restrictions across the country following historic protests last month.

We are waiting, as the reopening in China will take time. We may have already built some of the optimism into the price, so now we need to see the real facts start to improve.said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

The Yangshan copper premium fell to its lowest level since July 22 on Monday, as low as US$72.50 a tonne, signaling weakening demand for imported copper in China.

The most-traded January copper contract on the Shanghai Futures Exchange fell 0.7% to 65,770 yuan ($9,402.43) a tonne.

The strength of the dollar index also weighed on the market, after its biggest rise in two weeks after strong data from the US services sector fueled expectations of interest rate hikes.

A stronger dollar makes greenback commodities more expensive for buyers using other currencies.

Zinc on the London Metal Exchange (LME), however, swam against the tide and rose 1.4% to $3,169 a tonne, after a further drop in LME inventories, which have halved. since the beginning of September.

Among other industrial metals, LME nickel was down 2.4% at $28,005 a tonne; lead was down 0.6% at US$2,224.50; and tin was down 0.6% at $24,300.

With information from Reuters

Source: Elcomercio

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