(June 11): Copper inched lower for a third day as fresh fighting in the Middle East raised concern around faster inflation, higher interest rates and slower economic growth.
The US Central Command carried out what it called “additional self-defence strikes,” which followed action on Tuesday in retaliation for the downing of an American helicopter. The moves underscored President Donald Trump’s growing impatience that the US and Iran have so far failed to reach a peace agreement.
The latest US strikes underlined how far both sides are from reaching a peace deal to end the conflict that’s roiled financial markets and pushed up oil prices. That raised fears of faster inflation, with US consumer-price gains accelerating at the fastest pace in more than three years in May.
Expectations of Federal Reserve rate hikes due to the escalation in fighting are pressuring base metals, Zhan Dapeng, an analyst at Everbright Futures Co, said in a note. The volatility in copper prices is also making Chinese buyers cautious ahead of the seasonal summer lull, he said.
Copper dropped 0.6% to US$13,436 a tonne on the London Metal Exchange as of 8.57am in London, after falling to US$13,378 earlier, the lowest since May 20. Zinc was down 1.2%, while aluminium rose 0.5% after tumbling 2.3% on Wednesday.
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