Key Takeaways
- Copper prices dropped to a three-week low, down 1.2%.
- London Metal Exchange inventories increased, adding to selling pressure.
- A stronger dollar and concerns over U.S. monetary policy weighed on industrial metals.
Copper prices fell to a three-week low, declining 1.2% to $14,065 a metric ton, according to official open outcry activity on the London Metal Exchange (LME).
The price of copper hit a session low of $14,018.50, marking the lowest level since August 20, and has already lost 5.9% from its record high last Thursday.
Neil Welsh, head of metals at Britannia Global Markets, noted that copper has led the decline and is now challenging recent lows, extending the cautious tone following the first weekly loss since June.
The renewed concern over tighter U.S. monetary policy is affecting risk appetite, with a stronger dollar making greenback-denominated metals expensive for investors using other currencies.
Copper prices dropped sharply last Thursday after Reuters reported that the White House had yet to decide whether to impose tariffs on refined copper imports, leading to a rush to ship metal to the U.S. COMEX exchange.
COMEX copper stocks, which had been increasing for 58 straight days, dipped slightly to 767,504 short tons, or 696,268 metric tons, on Thursday.
LME copper inventories increased by 9,600 tons, with 4,550 tons added to warehouses in Italy, contributing to the selling pressure.
The cash LME copper contract traded at a $36 a ton discount to the three-month forward, widening from a roughly $10 discount on Friday, indicating easing near-term tightness.
Sentiment in metals was weak, with other industrial metals also experiencing losses. Zinc fell 1.9% to $3,807, hitting a three-week low, while lead lost 1% to $1,873, its weakest since August 3.
Nickel shed 0.5% to $16,380, notching a two-month low, and tin fell 2% to $52,300, touching its lowest since July 17. Aluminium was the sole gainer, edging up 0.1% to $3,256.
