London copper prices experienced an upward trend on Thursday, benefiting from robust market fundamentals and a decline in the U.S. dollar. The three-month copper on the London Metal Exchange (LME) moved 0.5% higher to $9,422.50 per metric ton, reversing losses from the previous session.
The contract had declined on Wednesday following higher-than-expected U.S. inflation data for March, which shifted the anticipated timing of a first rate cut to September from June. This development impacted investor sentiment and led to a surge in the U.S. dollar, increasing the cost of purchasing the commodity priced in greenbacks.
Despite this, the overall outlook for copper remains positive, with ANZ analysts noting that supply-side disruptions and a surge in China’s manufacturing activity are expected to maintain a tight market.
The dollar index was slightly lower on Thursday from a near five-month high. Additionally, recent data revealed that China’s consumer prices rose for a second consecutive month in March, indicating a gradual easing of deflationary pressures. However, persistent producer price deflation continues to exert pressure on policymakers to introduce additional stimulus due to weak demand.
In Shanghai, the most-traded June copper contract on the Shanghai Futures Exchange remained relatively stable at 76,500 yuan ($10,572.29) per ton. The SHFE is set to implement restrictions on the maximum intraday position opening volumes for the copper contract starting from April 12.
In addition to copper, other metals also exhibited movements in prices on both the LME and SHFE, with tin, aluminium, nickel, zinc, and lead experiencing varied fluctuations.