The US dollar weakened and eased concerns about its impact on corporate profits, while the euro recovered from a 12-year low in trading today.
After months of strong jobs data, expectations have been growing that the Federal Reserve would signal a June rate rise at a meeting that begins on Tuesday. A stronger dollar erodes purchasing power for commodities. That, plus questions over China’s economic growth after comments by Premier Li Keqiang added headwinds to copper, analyst Joel Crane of Morgan Stanley in Melbourne told Reuters.
“What we’ve seen on China’s data indicators so far is fairly negative, so it’s not surprising that people would be worried about whether the post-New Year recovery is underway,” Crane said.
Premier Li vowed to keep China’s economy growing at a reasonable speed, even as he also said authorities could do more to stoke growth, which triggered a rally in Chinese equities.
The prospect of more Chinese stimulus, and a rise in interest rates in the US, helped copper to a weekly gain. Prices have been gaining ground as China’s factories ramp up after the Lunar New Year, climbing from 5-1/2 year lows of under $5,400 a metric t0n in January, but slowing economic growth and ample refined supply has blunted momentum.