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.
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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.
The week’s biggest mover on the weekly Copper MMI® was the price of Chinese copper wire, which saw a 0.8% increase to CNY 42,780 ($6,832) per metric ton. This comes on the heels of a 0.5% decline the week prior. The price of Chinese copper bar rose 0.7% to CNY 43,620 ($6,966) per metric ton after falling 0.5% during the previous week. The cash price of Chinese copper rose 0.7% to CNY 43,820 ($6,998) per metric ton after falling 0.5% during the previous week. Closing at CNY 33,400 ($5,334) per metric ton, Chinese bright copper scrap remained unchanged for the week.
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Following a 1.4% increase in the week prior, the cash price of primary Japanese copper fell 0.3% last week to JPY 722,000 ($5,951) per metric ton. The price of US copper producer grade 122 remained steady from the previous week at $3.39 per pound. Korean copper strip prices held steady from the previous week at KRW 8,619 ($7.62) per kilogram. Following a steady week, prices for the price of US copper producer grade 102 closed flat at $3.58 per pound. The price of US copper producer grade 110 closed at $3.39 per pound after a flat week.
The copper 3-month price rose 0.4% on the LME to $5,850 per metric ton after falling 1.4% during the previous week. The primary copper cash price rose 0.2% on the LME to $5,865 per metric ton after falling 1.3% during the previous week.
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