METALS-Weak China inflation data pushes copper prices to a five-month low

By Reuters / May 11, 2023 / www.kitco.com / Article Link

(Updates prices after copper extends fall) By Polina Devitt LONDON, May 11 (Reuters) - Prices for copper and otherbase metals fell in London on Thursday, hitting multi-monthlows, after inflation data from the top consumer China added toconcerns over the strength of the country's economic recovery. Benchmark copper on the London Metal Exchange (LME)was down 3.7% at $8,164 a tonne by 1606 GMT, after touching$8,152, its lowest level since Nov. 30. "The copper market has broken down through the key supportlevel of $8,450, which it was testing for a couple of days. Itis triggered by weak inflation data out of China, whereconstruction and infrastructure sectors are not doingparticularly well," said Dan Smith, head of research atAmalgamated Metal Trading. China's consumer prices rose at the slowest pace in morethan two years in April, data showed on Thursday. Producerdeflation deepened last month, highlighting the broadereconomy's struggles to rev-up after the lifting of COVID curbsin December. China also has seen a sizeable increase in refined copperexports over the last couple of months, suggesting that domesticdemand is not as strong as many were expecting, said ING analystEwa Manthey. Copper inventories in LME-registered warehouses continued to rise on Thursday, reaching 75,950tonnes, their highest since March 20. Adding pressure on dollar-priced metals, the dollar index rose, making the metals more expensive to holders ofother currencies, after U.S. jobless claims data strengthenedthe case for the Federal Reserve to halt its interest ratehikes. LME aluminium was down 2.5% at $2,211 a tonne, aftertouching $2,202, its lowest since Oct. 31. Nickel slipped 3.1% to $21,825, also after touching its lowest sinceOct. 31 at $21,710. Zinc fell 3.1% to $2,543, afterhitting $2,537, its lowest since November 2020. Lead was 1.3% lower at $2,126.3 and tin wasdown 2.4% at $25,220. (Reporting by Polina Devitt; additional reporting by Mai Nguyenin Hanoi; editing by Shilpi Majumdar)

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