Copper was revived by more encouraging data from China and US, highest since July 5th

Copper was revived by more encouraging data from China and US, highest since July 5th

That copper hovered around a one-month high on Tuesday as demand prospects improved on stronger-than-expected data from the United States and China, the metal’s top consumer, and were helped by a weaker dollar.

As reported by the Portal agency, the red reference metal on the London Metal Exchange fell by 0.1% to USD 7,975 per ton. Prices surged to $8,020 on Monday, a high not seen since July 5.

“In the near term, the improving data means that equity and credit markets are pricing in the risk of a deeper downturn. In this context, base metals could catch up with this positive risk shift,” said Giles Coghlan, an analyst at broker HYCM.

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Among the strongest data were China’s copper imports, which rose to 463,693 tonnes in July, up 9.3% from a year earlier, as sharply falling prices sparked buying.

Also included is US employment growth, which accelerated unexpectedly in July, raising expectations of another 75 basis point rate hike in September when the Federal Reserve meets again.

Among other base metals, aluminum rose 1.1% to $2,473 a tonne, zinc was up 0.6% to $3,465, lead fell 0.1% to $2,161, tin fell 0.6% to $24,150 and nickel fell 1.1% to $21,450.

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US consumer price data to be released on Wednesday will provide further clues on the direction of US monetary policy.

A further rise in US interest rates could boost the dollar, but it’s softening for now, making dollar-priced metals cheaper for holders of other currencies, which could boost demand.

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Low copper inventories in LME registered warehouses are supporting prices as is canceled orders – metal destined for delivery – which are at 28% compared to 18% in early August.

Growing concern over the availability of copper in the LME market is reflected in the price differential between the spot contract and the three-month contract, which is at zero compared to Friday’s $8 a tonne discount.