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Copper retreats on stronger dollar and rising LME stocks

Kitco News


LONDON, Sept 12 (Reuters) - Copper prices fell in London on Tuesday under pressure from a stronger dollar and rising inventories, though positive signals from top metals consumer China kept losses in check.


Three-month copper on the London Metal Exchange (LME) eased by 0.1% to $8,394 a metric ton by 1607 GMT.


"Copper prices have failed to hold the $8,400 level as LME inventories continue to build, taking them to their loftiest since October 2022," said Standard Chartered analyst Sudakshina Unnikrishnan.


Stocks of copper in LME-registered warehouses edged higher with 1,125 tons of arrivals into New Orleans, LME daily data showed, lifting the total to 135,650 tons, the highest since last October.


The dollar index, meanwhile, rose ahead of U.S. inflation data that could influence the Federal Reserve's next move on interest rates. A stronger U.S. currency makes dollar-priced metals less attractive for buyers holding other currencies.


Support for copper, used widely in the power and construction sectors, came from China's property market as developer Country Garden won approval from its creditors to extend repayments on six onshore bonds by three years.


"Better sentiment towards copper is still highly dependent on an economic recovery in China, but if stimulus measures bear fruit and the key real estate and manufacturing sectors recover, copper prices will gain," said Standard Chartered's Unnikrishnan.


On the technical front, copper is hemmed in by the 50-day moving average at $8,435 and the 21-day moving average around $8,354.


In other metals, LME aluminium fell 0.2% to $2,200.50 a ton, lead declined 1.5% to $2,216 while tin was down 1.3% at $25,475. Nickel lost 2.8% to $19,920 after touching its lowest since Aug. 17 at $19,855.


Zinc lost 1% to $2,485. The discount on zinc for near-term delivery versus the three-month contract on the LME reached its highest since March 2021.


(Reporting by Polina Devitt in London Additional reporting by Mai Nguyen in Hanoi Editing by David Goodman and David Evans)
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