Copper prices advanced on Tuesday as a weaker dollar made the metal cheaper for holders of other currencies, while supply risk in major producer Peru also lent some support.
Three-month copper on the London Metal Exchange rose 0.8% to $7,542 a tonne by 0138 GMT, while the most-traded September copper contract on the Shanghai Futures Exchange advanced 1.3% to 57,880 yuan ($8,578.50) a tonne.
The dollar wobbled around just below multi-decade peaks as traders waited on a rate hike decision from the U.S. Federal Reserve and for any clues about whether hints of a slowing economy will prompt a shift away from its focus on inflation.
Metals prices have been plagued by weakening demand in top consumer China due to COVID-19 outbreaks and fears of a deepening global economic slowdown that threaten future metals demand as central banks seek to hike interest rates to curb inflation.
Despite Tuesday’s rise, prices of copper, often used as a gauge of global economic health, have dropped 30% since its record high hit in March of $10,845 a tonne.
Chinese miner MMG Ltd said on Monday it had suspended its copper production targets for the year following a 60% output drop due to a long protest at its Las Bambas mine in Peru, which significantly disrupted operations.
LME aluminum rose 0.7% to $2,425 a tonne, LME zinc increased 0.5% to $3,000 a tonne, ShFE nickel climbed 2.2% to 167,430 yuan a tonne, while ShFE aluminum dipped 0.7% to 17,865 yuan a tonne.
Meanwhile, dozens of non-governmental organizations have sent an open letter to Tesla Inc’s Chief Executive Elon Musk to not invest in the nickel industry in Indonesia, the world’s biggest producer of the metal, on environmental concerns.
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1400 US Consumer Confidence July
1400 US New Home Sales-Units June
— US U.S. Federal Open Market Committee starts its
two-day meeting on interest rates (to July 27)
($1 = 6.7471 yuan) (Reporting by Mai Nguyen in Hanoi; Editing by Shounak Dasgupta)