LONDON- Prices for copper fell in London on Wednesday under pressure from global services activity data that darkened the demand outlook for growth-dependent metals.
Benchmark copper on the London Metal Exchange (LME) traded 0.3 percent down at $8,331 a metric ton.
Prices for the metal used in power and construction are flat so far this year owing to a slower than expected post-pandemic recovery for top consumer China.
China’s services activity expanded at the slowest pace in five months in June, a private-sector survey showed on Wednesday, and euro zone business activity began to contract.
“The June set of global PMI (purchasing managers index) prints remained terribly poor on a historical basis, suggesting metals consumption will remain under pressure in the coming months,” Citi analysts said in a research note.
Some investors still hope that possible Chinese economic stimulus will spur faltering economic growth, but Citi believes such optimism is excessive.
Citi expects copper to average $8,000 a metric ton over the next three quarters and to trade in a range of $7,500 to $8,500.
Adding further pressure on demand for dollar-priced metals, the US currency rose as traders awaited minutes from the Federal Reserve’s last policy meeting to glean any insights on the interest rate outlook.
