LONDON- Copper prices rose on Friday following the dollar’s retreat after earlier losses on shrinking factory activity in top consumer China for a fifth straight month fueled uncertainty about the demand outlook for industrial metals.
Three-month copper on the London Metal Exchange (LME) (LME) was up 0.3 percent at $8,521 a metric ton.
Weak US manufacturing data raised the prospect of US interest rate cuts, which weighed on the US currency making dollar-priced metals cheaper for holders of other currencies.
China’s official manufacturing purchasing managers’ index (PMI) fell to 49.1 in February from 49.2 in January, with factories closed during the month for a holiday.
However, negative sentiment was tempered by the Caixin/S&P Global survey, which showed manufacturing activity of small-to-medium businesses expanded steadily as both production and new orders grew faster.
“Overall, China’s manufacturing sector still doesn’t look too healthy,” a metals trader said.
China’s ailing property sector, a major consumer of industrial metals has weighed on the market for some time. This was reinforced recently by a liquidation petition filed against property developer Country Garden. – Reuters