MARKET INSIGHT - Metal Prices Rise but Strong Dollar Limits Gains

Forex - Most base metal prices rose within a narrow trading range, but gains were capped by a strengthening dollar due to expectations that U.S. interest rates will remain high for a longer period. The dollar index was trading at 108.17 dollars at 06:44 GMT, remaining close to the two-year high of 108.43 dollars seen last Thursday.

Despite downward pressure on copper from a strong dollar, the metal found support from robust production demand. Three-month copper on the London Metal Exchange (LME) rose by 0.3% to $8,944 per ton at 06:44 GMT. An analyst stated, “In terms of copper demand in China, the recent high operating rates of production are supporting copper consumption. However, there are signs of seasonal slowdown in the winter months.”

On the Shanghai Futures Exchange (SHFE), the January copper contract was trading at 73,910 yuan per ton ($10,126.32) with a decrease of 0.2% at the close of the Asian morning session. On the LME, aluminum traded up 0.2% at $2,531 per ton, nickel was up 0.9% at $15,435 per ton, zinc rose by 1.0% to $3,103 per ton, tin increased by 0.7% to $28,735 per ton, and lead was up 0.1% at $1,987.5 per ton.

On the SHFE, aluminum fell 0.7% to 19,820 yuan per ton, nickel increased by 0.3% to 124,390 yuan per ton, zinc rose by 1.1% to 25,165 yuan per ton, lead decreased by 0.6% to 17,400 yuan per ton, and tin fell by 0.3% to 242,930 yuan per ton.