Copper prices hit a two-week high on Monday, with a weak US dollar and support measures and top metal consumers expecting a recovery in demand as China plans to end the COVID-19 lockdown.
The benchmark copper for the three-month period rose 0.8% to 9 9,497.50 a tonne on the London Metal Exchange (LME), reaching 11 9,532 in Asian trade, the highest since May 5, at 0711 GMT.
The most active June copper contract on the Shanghai Futures Exchange rose 0.4% to 72,050 yuan ($ 10,813.77) per tonne, after touching a high since May 6.
“The move is aimed at stimulating a larger property sector than the expected China rate-cut, which will provide a short-term bounce,” said Stephen Ines, managing partner at SPI Asset Management.
“Last week, everyone was worried about stagnant inflation and products are not immune to that cyclical recession. So, we’re seeing short-covering or some re-entry into Chinese demand. “
Shanghai, in its seventh week of lockdown, is slowly allowing more people to leave their homes in recent days and plans to lift the citywide lockdown and return to a more normal life from June 1.
China lowered its benchmark reference rate for mortgages by an unexpectedly wide margin on Friday as Beijing seeks to revive the ailing housing sector to boost its economy.
Dollar: The dollar fell 0.2% last week to a near two-week low, making the greenback-aligned metal less expensive for buyers using other currencies.
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IRONORE: India raises export tariffs for iron ore and steel intermediaries, raising benchmark iron ore futures in China by about 7% on Monday.
Copper: Activities at the Khomakou Zone 5 copper and silver mines in Botswana have been suspended after two people were killed in an underground accident on Friday.
Inventories: Copper inventory in warehouses monitored by the Shanghai Futures Exchange fell 1.7% from a week earlier, the exchange said Friday.
Other metals: LME aluminum rose 1.5% to $ 2,989.50 per tonne, zinc 0.8% to $ 3,737, nickel 1.7% to $ 2,180.50, lead 1% to $ 2,180.50, while tin, 410.60%.
Shanghai Aluminum added 0.7%, zinc fell 1.1%, nickel slipped 1%, lead rose 1%, while tin prices fell 0.5%. ($ 1 = 6.6628 Chinese Yuan Renminbi) (Reporting by Brijesh Patel in Bangalore; Editing by Shuvrangshu Sahu and Uttaresh.V)