New York, October 10: Copper futures on the Chicago Mercantile Exchange (COMEX) fell on Tuesday, ending two consecutive days of gains, mainly due to pressure from macroeconomic weakness and concerns about the outlook for metal demand.
As of the close, copper futures fell by 1.65 cents to 2.5 cents, with the most actively traded December 2023 copper futures falling by 2.05 cents or 0.56% to close at $3.621 per pound.
December copper futures traded in a trading range of $3.5815 to $3.648.
Copper has fallen on five of the past seven trading days.
According to Sandeep Daggar, director of the Metal Intelligence Center (MIC), Chinese buyers bought at bargain prices after the Golden Week, but affected by the slowdown in macroeconomic growth, economic growth may slow down further in the future. .
On Tuesday, the International Monetary Fund predicted that China's economic growth would be 5.0% in 2023, lower than the 5.2% previously expected. Economic growth is expected to slow to 4.2% in 2024, 0.3 percentage points lower than the earlier forecast.
Daga added that copper prices may fall further as demand from China weakens.
On Tuesday, Chinese real estate giant Country Garden warned that it would not be able to meet its offshore debt obligations. The real estate industry is a major contributor to China's metal consumption.
The U.S. dollar exchange rate index closed at 105.557 points on Tuesday, down 0.254 points from Tuesday. A weaker dollar makes dollar-priced metals cheaper for buyers holding other currencies.
The recent COMEX copper futures contract has fallen 2.52% so far this month and 4.56% so far this year. The closing price on Tuesday was 4.43% higher than the same period last year, but it was still 26.31% lower than the historical peak hit on March 4, 2022.
Copper fell 14.6% in 2022 as global economic growth prospects are worrying. High inflation has prompted European and American central banks to actively raise interest rates to curb inflation, exacerbating the risk of economic recession. By comparison, copper in 2020 and 2021 has recorded gains of 25% for two consecutive years. The green transformation of the global economy and electrification have helped boost additional demand for this metal widely used in the power and construction industries, while copper mines are facing Disruptions such as underinvestment and production disruptions.
On Tuesday, the Shanghai Futures Exchange's November 2023 copper contract closed down 880 yuan at 66,900 yuan per ton. Bonded copper futures for December on the Shanghai International Energy Trading Center (INE) fell 830 yuan to 59,240 yuan per ton.
On Tuesday, COMEX copper futures trading volume was 68,796 lots, compared with 76,201 lots on the previous trading day; open interest volume was 201,171 lots, compared with 204,133 lots on the previous trading day.
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