BEIJING- Prices of base metals rallied on Thursday, as comments by US Federal Reserve Chairman Jerome Powell eased some investor worries about the pace of rate hikes, with sentiment buoyed by a weaker dollar and hopes of further stimulus from China.
Three-month copper on the London Metal Exchange was up 1.1 percent at $7,723 a ton, speeding up a rally seen since last Thursday.
The US Federal Reserve raised rates by 75 basis point for the second consecutive meeting to rein in inflation, such a move had been broadly anticipated and priced in the metals markets.
Comments from Fed Chair Jerome Powell after the policy statement were seen as less hawkish, therefore, sparking hopes of a slower interest rate hike for the remaining time this year.
Copper, with its wide application in different industries from power generation to transportation, is often used as an economic parameter.
A soft dollar also eased some pressure on metals, making it cheaper for holders of other currencies.
In other metals, LME aluminum gained 1.5 percent to $2,458 a ton, zinc climbed 1 percent to $3,086, nickel was flat at $21,813, lead edged up 0.6 percent to $2,025 and tin rose 1.7 percent at $24,750.
The market also hopes to see more stimulus on infrastructure projects that could strengthen metals demand after China’s Politburo meeting at the end of this month, where the country’s top decision-making body gathers to discuss economic policies for the rest of the year.
The most-traded September copper contract on the Shanghai Futures Exchange was up 1.9 percent at 59,330 yuan ($8,801.63) a ton.
ShFE lead climbed 0.3 percent to 15,240 yuan a ton, tin advanced 1.7 percent to 195,830 yuan a ton, and nickel rose 1.1 percent to 169,880 yuan a ton. — Reuters
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