Copper prices fell on Thursday as risk sentiment soured and demand outlook for metals dimmed due to prospects of protracted policy tightening by the U.S. Federal Reserve.
Three-month copper on the London Metal Exchange eased 0.1% to $7,621.50 a tonne by 0242 GMT, while the most-traded December copper contract on the Shanghai Futures Exchange slipped 0.1% to 63,500 yuan ($8,695.06) a tonne.
The Fed raised interest rates by three-quarters of a percentage point on Wednesday, and Chair Jerome Powell said the central bank was still undecided about how high rates would need to rise to curb inflation.
The dollar was firmer following Powell’s remarks, making greenback-priced metals more expensive to holders of other currencies.
LME tin dropped 2.1% to $17,625 a tonne, lead fell 0.3% to $1,983 a tonne, while aluminum rose 0.7% to $2,267.50 a tonne.
SHFE tin shed 2.4% to 156,270 yuan a tonne, lead fell 0.5% to 15,105 yuan a tonne, while nickel rose 0.6% to 192,710 yuan a tonne and aluminum increased 1.6% to 18,150 yuan a tonne.
The fall in metal prices was cushioned by hopes of an easing in COVID-19 restrictions in top consumer China, which could boost economic growth and metals demand.
Meanwhile, the world’s refined copper market showed a 16,000 tonne deficit in August, compared with 80,000 tonnes in July, the International Copper Study Group said.
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1400 US ISM N-Mfg PMI Oct ($1 = 7.3030 yuan) (Reporting by Mai Nguyen in Hanoi; editing by Uttaresh.V)