Copper prices rose to near their one-week highs on Wednesday as the U.S. dollar weakened on dovish comments from the Federal Reserve amid rising risks to trade and global growth.
The dollar struggled to bounce off a seven-week low after U.S. central bank officials hinted at the possibility of an interest rate cut. A weaker dollar makes dollar-denominated metals cheaper for imports by countries using other currencies.
Fed Chairman Jerome Powell on Tuesday dropped his standard reference to the Fed being “patient” in approaching any rate decision, saying instead the central bank was watching fallout from the trade war and would react “as appropriate”.
“The subsequent dovish tone in his speech is likely to buoy investors in coming sessions,” said Daniel Been of ANZ in a note.
* LONDON COPPER: Three-month copper on the London Metal Exchange (LME) rose as much as 0.4% to $5,903.50 a tonne, its highest since May 30. The contract eased slightly later in the session, edging up 0.3% by 0344 GMT.
* SHANGHAI: The most-traded copper contract on the Shanghai Futures Exchange also touched its highest in nearly a week at 46,630 yuan ($6,746.73) a tonne in early trade before edging down slightly to 46,560 yuan a tonne.
* LME PRICES: London zinc advanced 0.2% after touching its lowest since January in the previous session, lead eased 0.2% and aluminium edged down 0.1%.
* U.S. MANUFACTURING: New orders for U.S.-made goods fell in April and shipments dropped by the most in two years, indicating continued weakness in manufacturing activity that could undercut the broader economy.
* RARE EARTHS: China will consider strengthening controls on exports of rare earths, 17 chemical elements used in high-tech consumer electronics and military equipment, to protect and better use such “strategic resource”, its state planner said.
* U.S.: The U.S. Commerce Department recommended urgent steps to boost domestic output of rare earths and other critical minerals, warning that a halt in Chinese or Russian exports could cause “significant shocks” in global supply chains.
* CHINA LITHIUM: An estimated 5 million tonnes of lithium deposits have been found in China’s Yunnan province, scientists said, potentially curbing the nation’s reliance on imports of the material used in electric vehicle batteries.
* PANAMA COPPER: Panamanian President-elect Laurentino Cortizo said his government would review a copper mining contract awarded to a subsidiary of Canada’s First Quantum Minerals, casting uncertainty around the project.
* CHINA ECONOMY: Chinese President Xi Jinping said the country’s economy was stable, healthy and well placed to meet all risks and challenges, according to a transcript published by the Xinhua news agency.