London copper prices slid from its two-month highs on Wednesday due to a firmer United States dollar and renewed economic risks.
The losses were, however, capped by firm supply-demand outlook, according to Absa Bank Zambia daily market report.
Three-month copper on the London Metal Exchange eased 0.3 percent to US$8,426.50 per metric tonne, after hitting its highest level since September 15 on Tuesday.
On Tuesday, copper prices rose to their highest in nearly two months as industrial commodities benefitted from growing optimism for an end to the Federal Reserve’s rate hikes.
This was also sustained by growing hopes of fresh stimulus and demand in China, a softer United States dollar and protests at a mine in Panama.
Benchmark copper on the London Metal Exchange (LME) was up 0.9 percent at US$8,344 a metric tonnes in official rings, having earlier touched US$8,355 for its highest since September 29, 2023.
Mining.Com reported that investors had been adding to bets that the Fed’s tightening cycle had ended after a series of United States data points showed the world’s biggest economy was slowing.
Higher borrowing costs and a relatively strong dollar had been key headwinds for metals in the past two years.
In addition, hopes for stronger copper consumption were raised by a pledge from China’s Central Bank to ensure financing support for the property sector, a major consumer of industrial metals.
“There is a fair amount of stimulus in the pipeline and we are in a seasonally strong period,” said Dan Smith, Head of Research at Amalgamated Metal Trading.
“For me, copper demand looks strong in China, primarily in the green sectors. We know utilization rates at wire rod plants picked up into mid-November.”
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