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LME Copper Inches Up On China Efforts To Support Virus-Hit Economy

17 Feb 2020 9:58 am
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Mumbai (Commodities Control) – Copper prices edged up on Monday after China's central bank lowered the interest rate on its medium-term loans to support an economy jolted by disruptions to logistics and factory output due to the coronavirus outbreak.

Three-month copper on the London Metal Exchange (LME) was up 0.5% at $5,788 a tonne by 0216 GMT, while the most-traded copper contract on the Shanghai Futures Exchange (ShFE) edged up 0.1% to 45,910 yuan ($6,582.27) a tonne.

The People's Bank of China (PBOC) said it was lowering the rate on 200 billion yuan ($28.65 billion) worth of one-year medium-term lending facility loans to financial institutions, paving the way for a cut of the benchmark loan prime rate, due to be announced on Thursday.

The PBOC said on Saturday Chinese lenders will tolerate higher levels of bad loans to support firms hit by the epidemic, which has killed over 1,700 people and infected about 70,550 in China, where it is severely disrupting business activities.

LME aluminium rose 0.2% to $1,725.50 a tonne, nickel advanced 0.8% to $13,115 a tonne, zinc increased 0.6% to $2,162 a tonne, while ShFE aluminium dipped 0.4% to 13,640 yuan a tonne and ShFE nickel fell 0.8 to 104,750 yuan a tonne.

Copper and zinc inventories in warehouses tracked by ShFE climbed to their highest in 11 months, as the outbreak sapped demand in top metals consumer China.

China's auto market could see sales slide over 10% in the first half of 2020 due to the epidemic, its top auto industry body said.

Copper miner First Quantum Minerals Ltd said talks to sell minority stakes in its Zambian mines have stalled amid the virus outbreak.

The LME canceled its annual Asia Week dinner in Hong Kong, a major metal event, and postponed the seminar that would have taken place on the same day due to the epidemic.

(Commodities Control Bureau)

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