It’s been a tough week on the metal markets with most of our major indicators falling substantially over the past week. Aluminium has gone against the grain and has remained firm, however other metal haven’t fared so well. In AUD terms, we have seen Copper – AUD 297/t, Lead – AUD94/t & Nickel – USD1429/t
With the Australian dollar having remained reasonably steady throughout the week, any LME falls have been directly translated into AUD losses.
**** DJ Copper Prices Retreat Amid Jitters About Chinese Demand ****
By Tatyana Shumsky
NEW YORK–Copper futures fell on Monday, as some investors shed holdings of the industrial metal ahead of key economic data from China, the world’s top copper consumer.
China is due to release its third-quarter economic growth data overnight. The world’s second-largest economy is expected to have slowed its expansion pace to 7.2% for the period, from 7.5% in the second quarter, according to a median forecast of 15 economists polled by The Wall Street Journal. This would be the slowest quarterly growth since March 2009. ”Copper is having a hard time, despite Chinese stimulus, their growth rates are not what they used to be,” said Adam Klopfenstein, a senior market strategist with Archer Financial Services in Chicago. China’s central bank financial executives last week said it plans to extend up to 200 billion yuan ($32.8 billion) in short-term loans to 20 large banks, with the goal of spurring lending activity and boosting growth. Signs of economic slowdown from China, which accounts for 40% of global copper demand, have weighed on copper prices for much of 2014. Copper is widely used in construction and manufacturing, and some investors worry that a slowdown in business activity could curtail demand for copper. Edward Meir, senior commodities strategist with INTL FCStone, sees a 30% chance of Chinese growth falling to between 5% and 6% next year, from an expected 7.2% in 2014. This is a particular concern for the property market, which makes up 20% of China’s economy, he said. Copper electrical wiring and plumbing are widely used in both residential and commercial construction, and demand for the metal would decline alongside economic growth.