Copper prices fell on Wednesday to their lowest since November 2020, weighed down by a robust US dollar and threats to demand from heightened fears of a global recession and renewed lockdowns in top consumer China.
Three-month copper on the London Metal Exchange was down 2.5 percent at $7,483 a ton, its lowest since November 27, 2020.
The most-traded August copper contract in Shanghai dropped 5.5 percent to 57,550 yuan ($8,582.76) a ton by the midday break.
The dollar stood tall near a 20-year peak against the euro, making greenback-denominated metals more expensive for other currency holders.
“The base metals complex remains pressured by macro headwinds stemming from China’s COVID lockdowns and the impact of monetary policy tightening and slowing global growth on demand,” Standard Chartered said in a note.
Adding to slowdown worries, business growth across the euro zone slowed further last month, according to a survey in which forward-looking indicators suggested the region could slip into decline this quarter.
In 2022, supply side may exceed the demand side in base metal complex. Investors are refraining to take a large position in this market as recession fears mount, said Vandana Bharti, assistant vice-president of commodity research at SMC Comtrade. – Reuters
