The three-month copper on the London Metal Exchange declined 0.5% to $8,507 a tonne by 0804 GMT, while the most-traded June copper contract on the Shanghai Futures Exchange fell 0.8% to 66,560 yuan ($9,612.66) a tonne. Chinese copper product makers are cutting their output for the second quarter, typically the peak demand season, because of a slower-than-expected recovery in domestic consumption after COVID-19 and sluggish exports. Copper bulls have been betting on a strong demand recovery from top consumer China, but the rebound has so far been relatively short-lived and weaker than expected. Prospects of higher U.S. interest rates could dampen global economic growth and increase the likelihood of a stronger dollar, making greenback-priced metals more expensive to holders of other currencies. Denting sentiment further were troubles in the U.S. banking sector. China's demand is expected to weaken more next week as the country enters a May 1-3 holiday. There have been some imports of copper into China backed by open import arbitrage, but with the holidays next week, LME price could lose as much as $300 a tonne in the next few sessions, said a trader. Copper price also faces downward risks in the second quarter on inflation pressure, which hinders any hope for a rate cut, and limited demand recovery, Jinrui Futures said in a note.
LME aluminium edged down 0.5% at $2,316.50 a tonne, nickel declined 0.8% to $23,465, zinc shed 0.6% to $2,629.50, tin lost 0.2% to $25,710, while lead rose 0.3% to $2,112. SHFE aluminium fell 1.4% to 18,435 yuan a tonne, tin declined 0.4% to 206,050 yuan, while nickel rose 0.1% to 179,420 yuan, zinc was up 0.1% to 21,110 yuan and lead edged down 0.1% to 15,275 yuan. For the top stories in metals and other news, click or ($1 = 6.9242 yuan) (Reporting by Mai Nguyen in Hanoi; editing by Eileen Soreng and Sohini Goswami)
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