BEIJING- London copper prices drifted lower on Wednesday on hawkish comments from US Federal Reserve officials, while flaring geopolitical tensions between the US and China during House Speaker Nancy Pelosi’s trip to Taiwan aided risk-off sentiment.
Three-month copper on the London Metal Exchange declined 0.4 percent to $7,775 a ton.
Hopes of slowing interest rate hike and China’s stimulus have supported a recent rally in copper. The metal is often used as an economic indicator thanks to its wide application in a variety of industry sectors.
But bearish sentiment re-emerged following lower-than-expected global factory data that worsened recession fears.
Denting the mood further, San Francisco Fed’s Daly said the central bank’s work of bringing down inflation is “nowhere near” almost done and there is still “a long way to go” to lower inflation from four-decade highs.
Meanwhile, Pelosi arrived in Taiwan late on Tuesday, the Chinese-claimed self-ruled island, sparking backlash from Beijing.
China on Wednesday also announced fresh bans of some agricultural product imports from Taiwan, following its suspension of imports from 35 Taiwanese food exporters earlier this week in a warning ahead of Pelosi’s visit.
The most-traded September copper contract on the Shanghai Futures Exchange lost 0.3 percent to 59,870 yuan ($8,872.39) a ton.
LME tin shed 0.9 percent to $24,030 a ton, lead edged down 0.3 percent to $2,043 a ton, zinc eased 0.4 percent to $3,297.50 a ton, and aluminum dipped 0.3 percent to $2,406.50 a ton.
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