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Recasts, updates prices, adds comments
BEIJING, April 3 (Reuters) – Copper prices slid on Monday, under pressure from a firmer U.S. dollar as inflation concerns renewed, while a slowdown in China’s factory activity growth also weighed on investors’ sentiment.
Three-month copper on the London Metal Exchange CMCU3 was down 0.7% to $8,927.50 a tonne by 0558 GMT, and the most-traded May copper contract on the Shanghai Futures Exchange SCFcv1 dipped 0.4% to 69,200 yuan ($10,043.10) a tonne.
The U.S. dollar started the week higher, as fears over inflation resurfaced after a surprise announcement by major oil producers to cut production further, with traders wagering the Federal Reserve may need to increase interest rates at its next meeting.
A stronger dollar makes it less attractive for non-dollar holders to buy the greenback-priced commodity.
The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) fell to 50.0 in March, amid slowing production and weaker global demand. That followed February’s reading of 51.6, which indicated the first monthly expansion in seven months.
The reading far missed expectations of 51.7 in a Reuters poll, and echoed slower growth in an official PMI released on Friday. The 50-point index mark separates growth from contraction on a monthly basis.
In China’s spot market, refined copper premium climbed as suppliers lifted offer prices ahead of the Qingming Festival holiday on Wednesday, traders said.
Participants also pointed to rising demand from the air conditioning sector.
Planned production for air conditioning is forecast at 18.19 million units in April, up 4% from March and up 8.1% from the same period a year ago, according to CITIC Futures.
SHFE aluminium SAFcv1 eased 0.6% 18,625 yuan, zinc SZNcv1 declined 1.1% to 22,520 yuan, lead SPBcv1 shed 0.7% to 15,185 yuan, tin SSNcv1 fell 1.2% to 205,130 yuan, while nickel SNIcv1 was up 2.3% to 178,910 yuan a tonne.
For the top stories in metals and other news, click TOP/MTL or MET/L
($1 = 6.8903 Chinese yuan renminbi)
(Reporting by Siyi Liu and Dominique Patton; Editing by Varun H K)
((Siyi.Liu@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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