Copper boosted by declining dollar after weak US jobs data

Copper boosted by declining dollar after weak US jobs data
-A +A

LONDON (Sept 3): Copper prices climbed on Friday as the dollar was dragged down by a lacklustre reading of the US jobs market, stoking optimism for a more gradual tapering of stimulus in the world's largest economy.

Benchmark copper on the London Metal Exchange was up 0.6% at US$9,439 per tonne by 1600 GMT.

The metal used mainly in power and construction is set to end the week marginally higher, adding to a 4% weekly gain in the previous week.

The dollar sank to its lowest in almost a month against major rivals, supporting metals prices by making greenback-priced commodities cheaper for holders of other currencies.

US job growth slowed more than expected in August amid a softening in demand for services and persistent worker shortages, as Covid-19 infections soared.

Base metals were supported by the prospects that tapering has been delayed by the weak jobs data, said Saxo Bank analyst Ole Hansen.

INVENTORIES: Visible stocks of copper were down, underpinning prices. On-warrant copper stocks in LME-registered warehouses have fallen by a third in the last two weeks to 152,475 tonnes. 

In warehouses monitored by the Shanghai Futures Exchange, weekly copper stocks fell 15.9% to 69,278 tonnes. 

CHINA: Activity in China's services sector slumped into sharp contraction in August, a private survey showed, as restrictions to curb the Covid-19 Delta variant threatened to derail the recovery in the world's largest metals consumer.

ALUMINIUM: A prolonged period of high aluminium prices created partly by output cuts in China is expected to encourage new capacity in other parts of the world, which will eventually weigh on prices trading at 10-year highs.

Aluminium was up 1% to US$2,723 a tonne.

OTHER METALS: Zinc added 0.7% to $2,999 a tonne, lead shed 0.3% to US$2,305, tin was down 1.2% at US$33,100, while nickel was up 1.5% at US$19,744, after touching a five-week high.