LONDON- Copper prices rebounded after top metals consumer China pledged more support for its ailing economy and the dollar fell from 20-year highs, but the metal was still set for its biggest monthly fall since September.
A weaker dollar made greenback-denominated metals cheaper for buyers using other currencies, which increases their attractiveness.
Meanwhile, the top decision-making body of China’s Communist Party said the country would step up policy support to stabilize the economy and offset the impact of lockdowns put in place to slow the spread of COVID-19.
China accounts for about half of global metals demand.
Benchmark three-month copper on the London Metal Exchange (LME) rose 0.8 percent to $9,780 a ton on track for a monthly fall of more than 5 percent.
“We have some positive news from China’s Politburo, which pledged more measures to spur economic growth because the economy has been struggling,” said ING analyst Wenyu Yao.
The COVID-19 outbreak in China bodes ill for Beijing’s economic outlook and metals demand.
More businesses and residential compounds closed in Beijing and authorities ramped up contact tracing to contain the spread of the virus. The southern Chinese megacity of Guangzhou also moved to quash its COVID-19 outbreak.
The latest COVID-19 wave is likely to cause a further decline in Chinese factory activity in April, a Reuters poll showed, with extensive lockdowns halting production and disrupting supply chains.
China reports its closely watched factory activity data on Saturday. – Reuters
