(Updates prices)
By Eric Onstad
LONDON, Feb 9 (Reuters) - Copper prices rebounded on
Thursday, buoyed by a slide in the dollar and bets that China's
lacklustre metals demand will recover following its lifting of
COVID-19 controls.
Three-month copper on the London Metal Exchange was
up 1.1% at $8,986 a tonne by 1700 GMT after slipping 0.4% in the
previous session and touching a four-week low on Monday.
U.S. Comex copper futures gained 1.1% to $4.08 a lb.
Helping to boost industrial metals was a tumble in the
dollar index , partly on views that inflation has peaked
and the Federal Reserve will be able to slow its interest rate
hikes.
A softer U.S. currency makes dollar-priced metals cheaper
for buyers using other currencies.
A slowdown in the U.S. economy is allowing the Fed to move
"more deliberately" with any further interest rate increases,
Richmond Fed President Thomas Barkin said on Thursday.
Hopes for stronger demand in top metals consumer China also
lifted prices.
"The recovery after the Chinese New Year has definitely been
weak, but I'm broadly bullish about the next few weeks for
copper," said Dan Smith, head of research at Amalgamated Metal
Trading.
"When you think about the China macro story and the recovery
after COVID and the Chinese New Year, you need to look at where
we'll be by the end of the month."
Over the past 20 years, February has always been a strong
month for copper prices, Smith added.
Economists surveyed by Reuters forecast that yuan loans by
Chinese banks surged to a record high in January as the central
bank moved to shore up growth in the world's second-biggest
economy.
"It is expected that the enthusiasm for downstream
procurement will gradually pick up this week," Huatai Futures
said in a report.
With the record-high investment plan of State Grid Corp of
China for 2023 and the strength of the automobile sector, the
outlook for copper demand is positive, Huatai added. Both
sectors are major users of copper.
Among other metals, LME aluminium gained 0.8% to
$2,500 a tonne, nickel surged 5.6% to $28,910, zinc rose 0.2% to $3,138, lead added 0.4% to
$2,128.50 and tin climbed 0.9% to $27,870.
For the top stories in metals and other news, click ($1 = 6.7830 yuan)
(Reporting by Eric Onstad; Additional reporting by Mai Nguyen
in Hanoi; Editing by Emelia Sithole-Matarise, Elaine Hardcastle,
Jan Harvey and Paul Simao)
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