Falling inventories and weak dollar lift copper

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LONDON – Copper prices rose to their highest level in more than two weeks on Monday, with inventories falling and a weaker dollar surging, although gains were limited due to losses in demand from top consumer China coronavirus lockdown.

The benchmark copper on the London Metal Exchange (LME) rose 1.3% to 2 9,546 per tonne at 1602 GMT. Metals used in the power and construction industries hit a record high of $ 9,558 on May 5.

Libram analyst Tom Price, referring to the lockdown, the war in Ukraine and rising demand following the rise in US interest rates, said: “The main blow has been to the metal markets, which are stabilizing.”

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Even if China simplifies lockdown control and seeks to stimulate growth, the strongest period of demand for the metal – usually the second quarter – has already passed, Price said.

“The stimulus in China is now really a story for 2023.”

Copper: Copper inventory LME-registered warehouses decreased by 3,525 tonnes to 171,075 tonnes.

Canceled warrants – Metals scheduled for delivery – accounted for 46% of total inventory, suggesting that more metals will be leaving the LME warehouse in the coming days.

One firm has a large number of warrants, which raises concerns about LME market availability and creates a premium for three-month copper cash deals. .

Dollar: A weaker U.S. currency makes dollar-denominated products cheaper for other currency holders, which could increase demand.

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Aluminum: Aluminum stock LME systems had their lowest at 497,250 tons at the end of 2005, with canceled warrants standing at 60%.

Traders say most of this aluminum will go to Europe, where record high electricity prices have led to shortages and shortages.

Benchmark aluminum rose 0.4% to 2, 2,958 a tonne, reaching a high of 2, 2,998 since May 5.

LEAD: Stock 38,850 tons, the lowest increase since 2007. It was up 1.1% to 2,185 per tonne, down from the previous two-week high of 2,195.

Other metals: Zinc rose 2.1% to $ 3,786 per tonne, tin fell 0.2% to $ 34,595 and nickel fell 1% to $ 27,700. (Reporting by Pratima Desai, Editing by David Goodman)

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