Copper slips on worries China may tighten money

Print this page Posted on : 03-16-2010 by recycleinme.com

London, March 15

Copper prices fell on Monday as investors worried that potential monetary tightening in China could cap demand from the world’s top consumer of base metals.

Copper for three- month’s delivery on the London Metal Exchange traded at $ 7,327.50 a tonne at 1032 GMT from a close of $ 7,440 on Friday.

Investors were concerned that rising inflation in China would spur the country to tighten monetary policy.

Stoking this, China’s Premier Mr Wen Jiabao on Sunday expressed worry about inflation. Investors are concerned that a currency spat between China and the US.

It’s concerns about monetary policy, particularly in China, and that’s no big surprise because that’s ( China) provided the driving force for copper in the last 12 months,” said Mr Robin Bhar, an analyst at Credit Agricole.

The market’s still very much dependent on Chinese growth, Chinese buying, so therefore, any threat to tighten monetary policy will have repercussions.

STOCKS FALL

Stocks of copper fell 1,375 tonnes on Friday to 531,200 tonnes — standing at their lowest since late January after consistently falling in March. Aluminium traded at $ 2,237 from $ 2,260.50 and zinc was at $ 2,290 from $ 2,335. Battery material lead was at $ 2,220 from $ 2,265, tin traded at $ 17,450 from $ 17,550 and nickel was at $ 21,750 from $ 21,435.

Source : Business Line