London copper slips as dollar steadies, trade talks in focus
Three-month copper on the London Metal Exchange was down 0.4% at $5,902.50 a tonne, as of 0701 GMT, after edging up 0.1% in the previous session
Beijing: London copper prices drifted lower on Tuesday as the dollar firmed slightly, while investors awaited the outcome of the latest round of US-China trade talks in Beijing.
A stronger greenback makes dollar-denominated metals more expensive for holders of other currencies and can dent prices, which have been weighed down by concerns that the US-China trade row will hurt demand.
“Markets will be looking for some positive news, especially given weaker economic data in both countries of late,” ANZ wrote in a note.
China, the world’s top metals consumer, saw its factory activity contract for the first time in over two years in December, prompting Beijing to take steps to boost lending.
Copper: Three-month copper on the London Metal Exchange was down 0.4% at $5,902.50 a tonne, as of 0701 GMT, after edging up 0.1% in the previous session. The most-traded March copper contract on the Shanghai Futures Exchange closed up 0.1% at ¥47,340 ($6,903.59) a tonne.
Chile’s copper production could jump by nearly 30% over the next 10 years, Chile’s state copper agency Cochilco said on Monday.
Premiums: China copper premiums are currently at $70.50 a tonne, up $8 from an 18-month low of $62.50 in early December, indicating stronger immediate demand for physical copper.
Trade: US Commerce Secretary Wilbur Ross predicted Beijing and Washington could reach a trade deal that “we can live with” as dozens of officials from the world’s two largest economies resumed talks to end their trade dispute.
USD: The dollar index shed early losses to rise 0.2%, snapping a three-day losing streak.
Other metals: All other LME metals declined, with aluminium down 0.8% and zinc down 0.6%. In Shanghai, zinc ended up 0.7%, tracking a jump in the LME price on Monday, but aluminium slipped 0.6% and lead lost 1.3%.
Asian shares dipped on Tuesday, running out of steam after a brief rally sparked by hopes that Washington and Beijing may be inching towards a trade deal and that US Federal Reserve would halt its tightening if economic growth slows further.
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