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London copper sinks on expected US rate hike

Reuters reported that London copper slipped from a seven week peak hit the session before as expectations of rising US interest rates pushed up the dollar and flattened commodity prices.

Fundamentals;
1. Three month copper on the London Metal Exchange had slipped 0.8% to USD 5,862 per tonne by 0137 GMT, after ending little changed in the previous session when it struck its highest since January 13 at USD 5,960.

2. The most traded May copper contract on the Shanghai Futures Exchange slipped 0.6% to CNY 42,600 per tonne.

3. Janet Yellen's premium on consensus may lead to a Federal Reserve decision the chair hasn't yet endorsed, as a near majority aligns in favour of a possible June interest rate hike.

4. China's slowing economy will be at the forefront as parliament convenes for its annual meeting this week with a weekend interest rate cut a reminder of the challenge of balancing painful restructuring with combating the onset of deflation.
5. Growth in the US manufacturing sector jumped during February, with factories reporting their best gains since October.
6. Copper miner KGHM has no plans to follow competitors in cutting spending on mines and projects in reaction to bruised copper prices as it expects prices to recover soon.

Newmont Mining Corp's Indonesian copper export permit will not be renewed beyond March 19 unless it strikes a deal with Freeport-McMoRan Inc to invest in the latter's planned smelter.

Source – Reuters

 

Mar 10, 2015 11:39
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