SHANGHAI- Prices of base metals were mixed on Wednesday, ahead of the US Federal Reserve’s interest rate decision, with lead rising due to tighter supply in top consumer China.
Three-month copper on the London Metal Exchange (LME) CMCU3 was down 0.2 percent at $8,970.5 per metric ton.
The most-traded January copper contract on the Shanghai Futures Exchange SCFcv1 fell 0.8 percent to 73,970 yuan ($10,153.74) a ton by the close of Asia morning trade session.
The US dollar remained steady against major currencies as investors awaited the Fed’s decision on a potential hawkish rate cut ahead of other central bank meetings this week.
A Fed rate reduction typically lowers borrowing costs, which can boost economic activity and increase demand for metals, potentially driving up their prices.
SHFE lead advanced 0.5 percent to 17,585 yuan and LME lead added 0.3 percent to $1,991 on supply tightness.
The recent frequent smog alerts caused secondary lead smelters that produce recycled lead in China’s Anhui, Shandong and other areas to halt production, significantly tightening supply, Shanghai Metals Market noted.
As the year ends, large lead-acid battery producers are ramping up production in China, increasing the operating rate of lead-acid batteries, according to the note.
