Industrial Metals Price Watch: Copper Rebounds from Six-Week Low

on Jun 19, 2013

Copper for three month delivery returned above the $7,000-a-metric-ton mark in London on Wednesday, June 19, after having fallen yesterday to its lowest levels since May 3 at $6,965. The copper price was $7,011 a metric ton on the LME today.

Investors are eagerly awaiting the end of the two-day meeting of the Federal Open Market Committee that started on Wednesday and is expected to give hints whether the central bank plans to reduce debt purchases known as quantitative easing. Currently the Federal Reserve is purchasing $85 billion of debt a month, a figure that may be reduced to $65 billion according to forecasts by analysts surveyed by Bloomberg.

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Ben S. Bernanke, Chairman of the Federal Reserve, indicated on May 22 that stimulus measures may be curbed if the employment outlook showed “sustainable improvement”. US President Barrack Obama has given a strong indication that the US central bank chief will leave when his current term expires next year, by saying that Bernanke has stayed in his post “longer than he wanted”.

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According to HNA Topwin Futures Co.’s analyst Xu Liping “copper may come under further pressure if there’s any hint of scaling back stimulus”. “Tomorrow’s China flash PMI may provide further clues,” he added, as quoted by the newswire.
China’s Preliminary Purchasing Managers’ Index for the current month will be released on Thursday by HSBC Holdings Plc and Markit Economics.
In Shanghai, the copper for the October delivery declined to 50,710 yuan ($8,271) a ton, while the September copper remained relatively flat at $3.172 a pound on the Comex in New York.
Tin and led were in the positive territory earlier today on the London Metal Exchange, while nickel fell. Zinc and aluminium were relatively flat.


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