Copper Prices Hammered by Bleak Economic Outlook, Gold Dips

By Ambar Warrick– The prices of copper and most industrial metals tumbled on Tuesday amid growing concerns over a slowdown in major importer China, while gold prices slipped as safe haven buyers preferred the dollar.

dropped 0.4% to $3.859 a pound by 21:28 ET (01:28 GMT), extending sharp losses from Monday on fears of a bigger slowdown in Chinese demand. 

Global commodity markets plummeted after significantly weaker-than-expected from China raised concerns over sluggish demand from the world’s largest commodity importer.

Chinese industrial output grew 3.8% in July, which was below expectations of 4.6%, and also lower than June’s reading of 3.9%. The data comes on the heels of several COVID-19 lockdowns across the country, which have severely crimped economic growth this year. 

Chinese also read weaker than expected. Concerns over the economy were further exacerbated by an unexpected by the People’s Bank of China, pointing to extreme pressure on the central bank to support economic growth. 

slumped 1.2% on Monday, while and lost 4.6% and 0.4%, respectively. 

But major miner BHP Group (NYSE:) said it expects Chinese demand to remain resilient, despite current trends. The miner, which is the world’s largest by market capitalization, intends to ramp up its iron ore and copper production on the expectation that metal demand will recover. 

Gold prices edged lower on Tuesday, with the yellow metal also nursing steep losses as safe haven buyers pivoted into the dollar.

was flat around $1,779.13 an ounce, while fell 0.2% to $1,794.1. Both instruments shed about 1% on Monday, while the surged 0.7%.

Returns on gold, which is considered as a popular inflation hedge, have largely lagged inflation this year, amid volatility in metal markets. 

In contrast, the prospect of rising U.S. interest rates have seen traders broadly stick to the dollar as a safe haven. 


Source link

more recommended stories