Copper prices retreat

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SHANGHAI- Most base metals declined on Wednesday, weighed down by a strong US dollar, which led copper prices to pull back from their one-month high.

Three-month copper on the London Metal Exchange (LME) slid 0.2 percent to $9,138.5 per metric ton.

The dollar slowed its rally on Wednesday, as traders turned cautious ahead of the highly anticipated US consumer inflation report, set to be released later in the day, prompting hesitation in taking on new positions.

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The dollar index which measures the US currency versus six other units, stood at 109.24 – not far from the 26-month high of 110.17 touched on Monday.

A stronger dollar makes greenback-priced commodities more expensive for holders of other currencies.

The Producer Price Index in December saw a yearly rise of 3.3 percent, slightly under the 3.4 percent predicted by economists, and a monthly increase of 0.2 percent, according to data on Tuesday, signaling less inflation and potentially cautious Federal Reserve rate cuts this year.

The potential impact of US President-elect Donald Trump’s tariffs, combined with the Fed’s cautious stance on rate cuts this year, drove up Treasury yields and strengthened the dollar.

“The US dollar is pretty strong these days, exerting pressure on metals prices. Meanwhile, investors adopt a wait-and-watch attitude before Trump’s inauguration,” a trader said.

The most active copper contract on the SHFE was up 0.1 percent at 75,390 yuan ($10,283.31) a ton.

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