Copper falls as Middle East fighting renews inflation risks
XLB•Other LME and SHFE metals decline
Among other LME metals, zinc CMZN3 lost 0.71%, lead CMPB3 slumped 1.08%, nickel CMNI3 sank 1.02% and tin CMSN3 slipped 0.24%.
On SHFE, zinc SZNcv1 lost 0.64%, lead SPBcv1 slipped 0.78%, nickel SNIcv1 ticked 0.05% higher and tin SSN3 sank 1.38%.
Copper weakens as fighting escalates
Copper prices fell on Monday, as fighting escalated between the U.S. and Iran, with Tehran saying it had closed the vital energy corridor of the Strait of Hormuz once again.
Benchmark three-month copper CMCU3 on the London Metal Exchange slipped 0.72% at $13,387 a metric ton by 0300 GMT. The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 lost 0.75% at 103,030 yuan a ton.
Inflation and rates concerns weigh on metals
U.S. and Iranian forces exchanged heavy missile and drone assaults over the weekend, dampening risk appetite and rekindling fears that higher energy prices and inflation levels could prompt policymakers to keep interest rates higher for longer.
Oil prices increased, while the non-yielding gold and silver fell. O/R GOL/
Higher interest rates weigh on economic activity and thereby pressure industrial metals.
The U.S. dollar strengthened slightly over the weekend, making greenback-denominated commodities like copper more expensive for buyers using other currencies.
Aluminium holds steady despite supply concerns
Meanwhile, aluminium largely shrugged off a potential disruption to supply that looked set to return to capacity following an interim peace deal after war first broke out in the key Middle East region on February 28.
