Copper edges up as Fed rate hike clears uncertainty, China demand eyed
Copper prices edged up on Monday, as last week's interest rate hike by the US Federal Reserve dispelled months-long uncertainty over rates, while optimism persisted over strong China demand. Benchmark three-month copper on the London Metal Exchange was up 0.06% at $14,530.5 a metric ton by 0300 GMT. The most-traded copper contract on the Shanghai Futures Exchange edged 0.37% higher to 109,940 yuan ($16,419.49) a ton.
By Solomon Cefai SINGAPORE, Sept 21 (Reuters) — Copper prices edged up on Monday, as last week's interest rate hike by the US Federal Reserve dispelled months-long uncertainty over rates, while optimism persisted over strong China demand. 5 a metric ton by 0300 GMT. 50 a ton, its highest since September 10, when it hit a peak of $14,875. 49) a ton.
The Fed hike removed the biggest near-term uncertainty in the copper market, while extreme mine-side tightness and ultra-low Chinese domestic inventories still formed a floor, analysts from Chinese broker Everbright Futures said in a note on Monday. Higher interest rates can weigh on growth-dependent commodities like copper by dampening growth. Strong demand in China continues to support prices. The Yangshan copper, a gauge of Chinese demand for imported copper, finished last week at $124 a ton, its highest in nearly four years.
Expectations for inventory replenishment ahead of next week's National Day holiday in China also offered price support, according to the Everbright Futures analysts. Oil hit its lowest in over one week, even after the US and Iran exchanged new threats on Sunday amid a stalemate. US President Donald Trump said he would be open to meeting President Masoud Pezeshkian, who is expected to be in New York this week. The war has weighed on copper prices by threatening to dampen global economic growth.
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