(Updates prices, adds quotes)
Aug 11 (Reuters) – Copper prices fell on Wednesday, pressured by a stronger U.S. dollar and easing worries about supply as the possibility of a strike at Chile’s Escondida mine looked less likely.
The dollar was poised just below this year’s high against the euro and struck a five-week peak against the yen ahead of U.S. inflation data, with the prospect a strong number could pressure the Federal Reserve to wind back policy support.
A stronger dollar makes greenback-priced metals more expensive to holders of other currencies.
“Many Fed officials said the level of inflation has reached the threshold that prompted the bank to raise rates. This has allowed the U.S. dollar to maintain a strong momentum,” said Huatai Futures in a report, noting that base metals have been relatively resilient against a firmer dollar.
BHP Group Ltd and the union at its Escondida copper mine, the world’s biggest, said they had reached a tentative deal for a new contract, pending agreement from workers.
Three-month copper on the London Metal Exchange eased 0.5% to $9,478 a tonne by 0602 GMT, while the most-traded September copper contract on the Shanghai Futures Exchange tracked overnight gains in London to rise 0.7% to 69,760 yuan ($10,761.78) a tonne.
* Chilean miners expect copper prices to stay high for two to three years but remain wary of labelling the boom a “supercycle” like what happened a decade ago, a senior executive said.
* LME lead inventories MPBSTX-TOTAL fell to 58,325 tonnes, their lowest since July 2019, while ShFE lead stockpiles PB-STX-SGH hit a record 181,391 tonnes by the end of last week.
* LME nickel fell 1.3% to $18,710 a tonne, aluminium advanced 0.3% to $2,582 a tonne, while ShFE aluminium rose 1.2% to 20,090 yuan a tonne and tin climbed 2.3% to 238,160 yuan a tonne.
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