Copper Faces Worst Week in Four Months on LME

Forex - Copper in London has seen a slight increase, but it is on track for its worst week in four months due to the rising dollar and concerns over demand from the largest consumer, China.

Three-month copper on the London Metal Exchange (LME) rose by 0.6% to $9,042 per metric ton as of 0710 GMT after hitting a three-month low on Thursday. It has fallen more than 4% over the week.

The most traded December copper contract on the Shanghai Futures Exchange (SHFE) closed up 0.3% at 73,860 yuan (10,215.06$) per ton, but registered a weekly decline of 4.6%.

The dollar is poised for its best week in over a month due to the impact of Donald Trump's presidential election victory and expectations that the U.S. will pursue fewer interest rate cuts. A stronger dollar makes dollar-priced metals more expensive for holders of other currencies.

BMI analysts noted, “Industrial metal prices will remain extremely sensitive to any stimulus announcements from the Chinese mainland, and we anticipate market sentiment to lean towards further support amid expectations of renewed trade tensions with China under a second Trump presidency.”

Data indicates that growth in China’s factory production slowed in October, and it is still too early to say there is a turnaround in the property sector hit by the crisis, keeping calls for Beijing to ramp up recent stimulus measures alive.

China's property sector is the largest consumer of base metals. However, the exchange reported that copper stocks in warehouses monitored by the SHFE decreased by 6.6% compared to the previous Friday.

LME aluminum increased by 0.6% to $2,532 per ton, nickel fell by 0.2% to $15,595, zinc rose by 0.2% to $2,949.5, lead increased by 0.2% to $1,963.5, and tin surged by 1.2% to $29,280.

On the SHFE, aluminum rose by 0.5% to 20,780 yuan per ton, nickel dropped by 1.5% to 123,140 yuan, lead fell by 1.5% to 16,760 yuan, zinc decreased by 0.3% to 24,640 yuan, and tin saw a 0.4% decline to 243,530 yuan.