Dollar-denominated commodities are more expensive for holders of other currencies when the dollar is firmer. China's factory activity in the first two months grew slightly more slowly than expected, suggesting the economy needs time to fully recover from the impact of pandemic restrictions. Property investment in the January-February period fell again, as home buyers and developers remained cautious despite supportive government policies. That raised doubts over the pace of demand recovery for industrial metals.
"There's typically a one-year lag between property sector and copper demand, which means the actual consumption might not largely pick up till the end of this year," a Shanghai-based copper producer said.
Rio Tinto's head of copper Bold Baatar said on Tuesday the short-term outlook for copper is "pretty healthy", with global stockpiles trending down and mine disruptions eroding supplies from Latin America. Mining exports from Peru, the world's second-largest copper producer, dropped 19.8% in January, compared with a year-ago period, the sector's business chamber said on Tuesday, following a wave of protests. The dollar steadied in Asia on Wednesday, as investors reduced bets on U.S. rate cuts and concerns of a banking crisis ebbed. LME aluminium was down 0.4% at $2,343.50 a tonne, tin lost 1% at $22,715, zinc shed 0.4% to $2,899, nickel ticked down 0.4% at $22,945, while lead was flat at 0.8% to $2,086. SHFE aluminium rose 0.5% to 18,375 yuan a tonne, lead added 0.2% at 15,260 yuan, and tin edged up 0.1% to 186,300 yuan, while zinc slid 0.6% to 22,740 yuan and nickel eased 0.8% at 176,560 yuan. For the top stories in metals and other news, click or ($1 = 6.8962 Chinese yuan renminbi) (Reporting by Siyi Liu and Dominique Patton; Editing by Sherry Jacob-Phillips, Rashmi Aich and Barbara Lewis)
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