Copper recovers from 3-week low; Fed decision in focus
XLB•Other base metals mostly firmer
Among other LME metals, aluminium CMAL3 rose 0.18%, zinc CMZN3 gained 0.64%, lead CMPB3 advanced 0.45%, nickel CMNI3 added 0.30% and tin CMSN3 climbed 0.85%.
On the SHFE, aluminium SAFcv1 rose 0.58%, zinc SZNcv1 gained 0.69%, lead SPBcv1 added 0.35% and tin SSNcv1 climbed 0.99%, while nickel SNIcv1 fell 1.64%.
($1 = 6.7073 Chinese yuan renminbi)
Copper rebounds as traders await the Fed
Copper recovered from a more than three-week low on Wednesday amid some short-covering, even as investors expect the Federal Reserve to hike interest rates later in the day.
Three-month copper on the London Metal Exchange CMCU3 rose 0.67% to $14,178 a metric ton by 0700 GMT, after touching $13,926 on Tuesday, its lowest in more than three weeks.
The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 gained 0.76% to close at 107,740 yuan ($16,063.10) a ton.
Rates, inventories and China demand remain in focus
Markets were pricing in an over 90% chance of a 25-basis-point Fed rate hike, up from near 60% a week earlier, in the face of sticky inflation. Higher interest rates typically pressure economic growth, a headwind for industrial metals.
The dollar =USD hovered near a two-week high, while oil prices remained above $100 a barrel, adding to inflation concerns.
Jinrui Futures, a Chinese broker, said falling treatment charges, weak smelter margins and low inventories provided support for the red metal.
Signs of firmer physical demand in top consumer China also emerged. The Yangshan copper premium SMM-CUYP-CN, a gauge of Chinese demand for imported copper, rose to $110 a ton on Tuesday, the highest since early August.
