Prices sank to $2.0210 a pound on Monday, the lowest level since May 2009, as traders bet that weaker global economic growth would damp demand for industrial metals.
Advertisement
What has happened? China’s zinc and nickel smelters are planning to collaboratively reduce production, while copper producers will also meet to discuss a joint strategy amid a slump in prices. China’s apparent consumption of crude steel continued to shrink this year after falling in 2014 for the first time in more than a decade as a slowing economy hit industrial demand.
Precious metals also saw marginal upticks with COMEX gold futures up 0.07% or 60 cents to $1,070.30 an ounce, while spot gold rose 0.11% or $1.26 to $1,072.38 an ounce. If the market thinks “that they’re just creating higher stocks, that could be negative for prices in the medium term”.
Nickel gained 3.1 per cent to $US9190.
Nickel jumped 6 percent in Shanghai on Wednesday, leading a rebound in Chinese base metals, amid talk that producers may trim output as prices hit multi-year lows this week. Earlier in the session it rose to $US9330, its highest since November 17. Aluminium ended barely changed at $US1,446 a tonne, up 0.04 per cent, lead finished up 2.0 per cent at $US1,607 and tin added 0.5 per cent to $US14,425. Regulators have begun to collect some records of trading activity following a request from the group. “Doing these things will only prolong the pain of too much supply being on the market”.
USA markets will be closed Thursday for the Thanksgiving holiday and Friday will be a half day, resulting in low liquidity and thin trade conditions.
Dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.
The dollar gained after San Francisco Fed President John Williams said there was a “strong case” for a December rate hike if data doesn’t disappoint.
“The Chinese selling has been absolutely massive over the last few weeks, so I guess we’re getting some short-covering”, he said.
Advertisement
You have left for this month.
