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Copper price below $8,000 as slowdown fears mount

Copper metallurgical plant. (Stock Image)

The copper price dropped to a fresh 17-month low on Monday as renewed lockdowns in China and the prospects of aggressive rate hikes stoked fears of global economic slowdown, denting demand for metals.

Copper for delivery in September fell 1% from Friday’s settlement, touching $3.56 per pound ($7,847 per tonne) Monday morning on the Comex market in New York, the lowest since February 2021.

Click here for an interactive chart of copper prices

The most-traded August copper contract in Shanghai ended daytime trading down 3.1% to 60 660 yuan a tonne.

“Softening demand and concerns over a growth slowdown are dragging on the sector. We think improving Chinese economic activity will stabilize prices,” ANZ analysts said in a note.

“Inventories for metals are shrinking to multi-year lows. Supply challenges due to higher energy prices and other operational issues will allow little room for inventories build.” 

Adding to demand worries, cities in eastern China tightened covid-19 curbs on Sunday as coronavirus clusters emerge, posing a new threat to the country’s economic recovery under the government’s strict zero-covid policy.

(With files from Reuters)