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Copper set for first yearly fall in four as recession risks weigh

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Copper slipped on Friday and was heading for its first yearly decline since 2018 as an overall stronger dollar, worsening COVID-19 situation in China, and global economic slowdown worries weighed on industrial metals.

Three-month copper on the London Metal Exchange was flat at $8,422.00 a tonne, as of 0249 GMT. The metal, used in power and construction and seen as a gauge for the health of the global economy, was down 13.4% in 2022.

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On the Shanghai Futures Exchange, the most-traded February copper contract was down 0.4% at 66,080 yuan ($9,493.57) a tonne and was down about 1.1% for the year.

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The dollar was on track for its best performance in seven years, buoyed by the U.S. Federal Reserve’s aggressive monetary policy tightening and concerns about the global growth outlook.

A stronger dollar makes the greenback-priced commodity less attractive to non-dollar buyers.

Earlier this week, China announced that inbound travelers would no longer have to go into quarantine from Jan. 8.

Top metals consumer China’s strict COVID containment policy has curbed industrial activity and domestic demand, and last month ignited public unrest.

Around 9,000 people in China are probably dying each day from COVID-19, UK-based health data firm Airfinity said on Thursday.

China will boost fiscal spending “appropriately” in 2023 to support the slowing economy, focusing on tech innovation and key strategic sectors, the finance ministry said on Thursday.

Among other metals, LME aluminum was unchanged at $2,405 a tonne, zinc rose 0.5% to $2,999, lead eased 0.6% to $2,259, and tin climbed 1.1% to $25,195.

In Shanghai, aluminum was flat at 18,710 yuan a tonne, tin rose 0.7% to 208,730 yuan, zinc slipped 0.6% to 23,685 yuan, nickel gained 0.6% to 229,470 yuan, and lead edged 0.1% lower to 15,915 yuan.

For the top stories in metals and other news, click or ($1 = 6.9605 Chinese yuan) (Reporting by Brijesh Patel in Bengaluru; editing by Uttaresh.V)

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