Cop­per climbs, notches up best week in over a year

Zambian Business Times - - COMMODITIES - Source: Reuters

COP­PER edged up on Fri­day 16 Fe­bru­ary, post­ing its big­gest weekly gain in more than a year as the dol­lar hov­ered near three-year lows, while zinc climbed on de­plet­ing stocks.

Bench­mark cop­per on the Lon­don Me­tal Ex­change ended 0.7% higher at $7,233/mt. The me­tal, used in power and con­struc­tion, fin­ished nearly 7% higher on the week in its best per­for­mance since Novem­ber 2016.

“The re­turn of risk ap­petite that we are see­ing through a strong re­bound in stock mar­kets, in­fla­tion ex­pec­ta­tions and the weaker dol­lar has been sup­port­ive for in­dus­tri­als,” Saxo Bank An­a­lyst Ole Hansen said.

DOL­LAR: The dol­lar edged higher but was still near three-year lows against a bas­ket of cur­ren­cies, headed for its big­gest weekly loss in two years, as bear­ish fac­tors off­set sup­port the U.S. cur­rency could take from ris­ing Trea­sury yields.

The U.S. cur­rency has been weighed down by a va­ri­ety of fac­tors, in­clud­ing con­cerns that Wash­ing­ton might pur­sue a weak-dol­lar strat­egy and the per­ceived ero­sion of its yield ad­van­tage as other coun­tries start to scale back eas­ier mone­tary pol­icy.

A weaker dol­lar ben­e­fits dol­lar-priced com­modi­ties by mak­ing them more af­ford­able for buy­ers pay­ing with other cur­ren­cies.

MAN­U­FAC­TUR­ING: U.S data showed an un­ex­pected dip in in­dus­trial pro­duc­tion last month, but an­a­lysts said the fo­cus was on next week’s round of data.

“In­dus­trial pro­duc­tion data out of the U.S. was slightly dis­ap­point­ing but it didn’t spill over into the cop­per mar­kets,” Danske Bank an­a­lyst Jens Ped­er­sen said.

“The mar­ket will look into next week, where we get the next round of man­u­fac­tur­ing PMIs, which will be an im­por­tant gauge for the mar­ket to as­sess how global in­dus­trial ac­tiv­ity is do­ing.”

ZINC STOCKS: Zinc stocks MZN-STOCKS saw an out­flow of 2,700 tonnes to 151,650 tonnes, bring­ing in­ven­to­ries to their low­est since 2008.

PRO­CESS­ING FEES: Global zinc min­ers and smelters failed to reach any bench­mark deal on 2018 pro­cess­ing terms at an in­dus­try gath­er­ing this week, and any agree­ment is likely to be de­layed by a month or more as par­tic­i­pants hag­gle over prospects for grow­ing sup­ply in the sec­ond half, two in­dus­try sources said.

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