(Bloomberg) — Copper fell below $9,000 a tonne for the first time since October, while other metals fell on growing concerns about weak global demand.
Often regarded as a barometer of the global economy, copper has fallen 15% from a record high in March as investors’ attention shifts from concerns about tight supplies to weakening consumption. Fears are growing that monetary tightening in the United States, instability in European economies and strict measures due to covid-19 in the main user, China, will hurt demand for metals.
The metal fell as much as 4.3% to $8.938 a tonne on the London Metal Exchange, before paring losses as sentiment in financial markets deteriorated. Other metals also fell, with tin tumbling more than 10%, the biggest drop in two months.
“In the Thursday session, commodities are catching up with Wednesday’s equity decline, and other variables are contributing to the selling,” said Ed Meir, analyst at ED&F Man Capital Markets. “The charts for all six metals look broken, with no hint of an uptrend remaining in any of them.”
High inflation in the US has strengthened the Federal Reserve’s case for reining in price pressures, raising concerns about a recession. Officials are taking an increasingly aggressive tone, which has rattled risky assets across markets.
In China, Premier Li Keqiang urged officials to use fiscal and monetary policies to stabilize employment and the economy as the nation grapples with its worst Covid outbreak in more than two years and a debt crisis in its sector. real estate. Meanwhile, concerns are growing in Europe over the disruption of gas supplies from Russia, which could further hamper the continent’s industrial economies.
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«There’s a lot of bad stuff piling up,» said Tom Price, head of commodity strategy at Liberum Capital. «The Chinese economy was struggling going into this year and then it was hit by covid.»
Slowing demand has also seen copper inventories recover from dangerously low levels reached in March. Stocks on the London Metal Exchange (LME) hit their highest level since October on Thursday, thanks to inflows into warehouses in Europe and Asia.
Copper fell 2.7% to $9,090 a tonne at 5:51 pm on the LME. Aluminum lost 1.3% while zinc fell 3.8%.
Copper Sinks Below $9,000 as Metals Slide on Global Demand Fears
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