Sunday, September 25

Most base metals skid as dismal economic data dents outlook

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BEIJING — Prices of most base metals lost ground on Wednesday, as dismal data from the world’s major economies heightened fears of a global recession, dampening the outlook for metals demand.

Three-month copper on the London Metal Exchange was down 0.6% at $8,074.50 a tonne, as of 0223 GMT, while the most-traded September copper contract on the Shanghai Futures Exchange rose 0.5% to 63,140 yuan ($9,214.42) a tonne.

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Prices of copper, often used as an indicator of global economic health, have recouped 16% from a 20-month low touched in mid-July, but are down 17% so far this year.

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US private-sector business activity contracted for a second straight month in August to its weakest level in 27 months.

August also saw business activity in the euro zone contract for a second consecutive month, as consumers cut spending due to the cost-of-living crisis, while supply constraints also hurt manufacturers, a survey showed.

China, the world’s top metal producer and consumer, grapples with an economy hobbled by COVID-19 and property crisis. It cut its benchmark lending rate and has moved to support its property market.

The US dollar steadied just below recent peaks on Wednesday, as investors waited for more clues on Friday’s Jackson Hole meeting whether weak US data may slow the pace of Federal Reserve’s rate hikes.

LME aluminum was flat at $2,425 a tonne, zinc lost 0.4% to $3,471 a tonne, lead was down 0.3% to $1,971 a tonne.

ShFE nickel fell 2.6% to 172,750 yuan a tonne, tin lost 0.4% to 200,950 yuan a tonne, while aluminum climbed 1.3% to 18,835 a tonne.

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($1 = 6.8523 Chinese yuan) (Reporting by Siyi Liu and Emily Chow; Editing by Sherry Jacob-Phillips)