Market Outlook: Copper Continues to Decline Amid Strengthening Dollar and Concerns Over Chinese Demand

Foreks - Copper prices extended their decline, falling to the lowest level in two months amid concerns over a strengthening US dollar and demand from China.

Three-month copper on the London Metal Exchange (LME) dropped by 0.5% to $9,004 per ton at 04:50 GMT, reaching its lowest level since the beginning of September.

The December copper contract on the Shanghai Futures Exchange (SHFE) fell by 1.5% to 73,600 yuan per ton ($10,169.96), marking its lowest level since September 12.

The US dollar surged to a one-year high following Donald Trump's victory in last week's presidential election.

Citi analysts predict that copper prices could decline to between $8,500 and $9,000 per ton by the end of the year. According to analysts, potential increases in trade tariffs in the US and China's weaker-than-expected stimulus details have undermined confidence in a global production recovery by 2025, leaving investor positions vulnerable to further loosening.

Investors have also expressed disappointment over the scale of the recent stimulus measures taken by China to revive its sluggish economy.

On the LME, aluminum traded down 0.3% at $2,523.5 per ton, nickel increased by 0.3% to $15,775 per ton, zinc declined by 0.8% to $2,958 per ton, lead dropped 0.2% to $2,004 per ton, and tin fell by 0.9% to $29,390 per ton.

On the SHFE, aluminum decreased by 0.6% to 20,690 yuan per ton, nickel dropped by 1% to 124,940 yuan per ton, lead fell by 0.7% to 17,045 yuan per ton, zinc increased by 0.5% to 24,800 yuan per ton, while tin showed a decline of more than 3%.