Base metals fall as U.S. jobs data asserts rate-hike concerns

PUBLISHED: Mon, 10 Oct 2022 10:49:18 GMT
Mai Nguyen
Reuters
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Traders and clerks at work at the London Metal Exchange on July 22nd 2011 in London, United Kingdom. Benchmark copper on the London Metal Exchange traded at $9,719 a tonne in official rings from $9,685 a tonne on Thursday, when the metal used in power and construction fell to its lowest level this week. (photo by Paul Hackett/In Pictures via Getty Images Images)

Oct 10 (Reuters) – Prices of most base metals in London fell on Monday, as better-than-expected U.S. jobs data raised concerns the Federal Reserve would stick to its rate-hike narrative to tackle inflation.

U.S. employers hired more workers than expected in September and the unemployment rate dropped, giving the Fed more ammunition to continue with its aggressive monetary policy tightening path. Read full story

Rising interest rates in the United States are likely to strengthen the dollar and could hurt global economic growth and metals demand. A stronger dollar makes greenback-priced metals more expensive to holders of other currencies.

“NFP (nonfarm payrolls) were still ahead of expectations so the market sold off … We should get more relief rally after this NFP sell off is over,” said a metals trader, adding that the Chinese market is likely to be supported ahead of the country’s party congress later this month. Read full story

Three-month aluminium on the London Metal Exchange CMAL3 was down 1.2% at $2,272 a tonne, as of 0716 GMT, lead CMPB3 lost 2% to $2,029 a tonne and zinc CMZN3 declined 0.2% to $2,986.50 a tonne.

The most-traded November nickel contract on the Shanghai Futures Exchange SNIcv1 dropped 3.1% to 179,200 yuan ($25,183.39) a tonne and tin SSNcv1 shed 1.4% to 175,160 yuan a tonne.

Meanwhile, copper prices rose after Chile, the world’s top producer of the metal, announced the permanent closure of copper mining stopes related to a giant sinkhole in the northern part of the country. Read full story

LME copper CMCU3 rose 0.8% to $7,518.50 a tonne and ShFE copper SCFcv1 advanced 0.3% to 61,260 yuan a tonne.

Other metals on the ShFE rose to catch up with gains in the London market as Chinese traders returned from a one-week holiday.

ShFE aluminium SAFcv1 rose 1.6% to 18,565 yuan a tonne, zinc SZNcv1 increased 1.8% to 24,305 yuan a tonne and lead SPBcv1 was up 1.5% at 15,245 yuan a tonne.

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TOP/MTL or MET/L

($1 = 7.1158 yuan)

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