Copper prices witnessed an upsurge on Wednesday, closely approaching a two-week peak. This trend was bolstered by a diminishing U.S. dollar and the anticipation of robust demand in China, the leading consumer of metals. This outlook is rooted in Beijing's proactive measures to stimulate its economy and rejuvenate the property sector.
The three-month copper contract on the London Metal Exchange experienced a 0.4% increase, reaching $8,532.50 per metric ton by 0805 IST. In the prior session, the contract achieved its highest mark since February 2nd.
Simultaneously, the most-traded March copper contract on the Shanghai Futures Exchange (SHFE) observed a 0.8% rise, amounting to 68,940 yuan ($9,592.05) per ton.
Wednesday saw the U.S. dollar weaken substantially, mirroring a global downturn in bond yields. This depreciation in the U.S. currency renders dollar-denominated metals more affordable for buyers using other currencies. This shift follows China's announcement of a significant reduction in the benchmark mortgage rate on Tuesday, aimed at bolstering the faltering property market and the broader economy.
In December, the global refined copper market reported a surplus of 20,000 metric tons, a stark contrast to the 123,000-metric-ton deficit observed in the preceding month, according to the International Copper Study Group's latest monthly bulletin.
In other developments, LME aluminium climbed 2.4%, reaching a one-week high of $2,247 per ton.
Global primary aluminium production in January saw a 2.4% year-on-year increase, totaling 6.039 million tons, as per the International Aluminium Institute's data.
LME nickel advanced by 0.6%, settling at $16,450 per ton. Other metals also saw increases: zinc by 0.8% at $2,399, lead by 0.2% to $2,053.00, and tin by 0.6% to $26,565.
On the SHFE front, aluminium edged higher by 1.3% to 18,945 yuan per ton, while nickel remained steady at 127,180 yuan. Tin rose by 0.6% to 218,520 yuan, zinc gained 0.2% to 20,380 yuan, and lead decreased by 0.3% to 15,815 yuan.
(By Commoditiescontrol Bureau: 09820130172)
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