Copper steadies after hitting one-week low in the face of greenback’s gains

LONDON — Copper steadied on Wednesday after hitting a oneweek low earlier in the session as investors moved into the safety of the dollar before the release of the minutes from the US Federal Reserve’s most recent policy meeting.

The dollar hit a one- week high versus a currency basket thanks in part to a bouyant twoyear Treasury note yield, which hit a nine-year high as traders awaited the release of the Fed minutes.

The last readings of US wages and inflation came in higher than expected. Investors are now waiting to see if the Fed policy minutes due later on Wednesday will signal a quicker pace of interest rate increases than previously expected.

“There are still good indications that inflation might edge up and force the Fed to hike more than three times ( this year),” said Peter Fertig, a consultant at Quantitative Commodity Research.

“All in all, the fundamentals still look supportive for copper. The economic situation in China is not that bad, but there could be turbulence coming from the slide out of risky assets into safe havens.”

Benchmark copper on the London Metal Exchange (LME) ended up 0.40% at $7,119 a ton, having touched a one- week trough of $7,034.50.

Chinese markets are set to reopen on Thursday after a weeklong Spring Festival holiday.

On- warrant copper stocks in LME warehouses were down 1,075 tons at 289,975 tons. So far this year, they have risen by 84%.

Southern Copper Corp. won a tender to develop Peru’s estimated Michiquillay copper mine in an auction that attracted two bidders, the government’s Proinversion investment agency said.

China’s steel producers are eager to unleash their mill capacity when this winter’s output curbs end next month, hoping for a repeat of last year’s record profits based on high margins and reduced competition after the closure of outdated plants.

Glencore Chief Executive Ivan Glasenberg on Wednesday hailed the group’s full-year results as its “strongest on record”, bolstered by reduced costs and stronger commodity markets.

On-warrant stocks of available aluminium inventories in LME warehouses rose by 12,325 tons to 1,159,325 tons.

Aluminum ended up 0.70% at $2,201 a ton, zinc closed down 0.30% at $3,541 and lead ended down 1.7% at $2,554. Tin closed up 0.20% at $21,625 while nickel closed up 1.7% at $13,845. —