LME copper prices rose for the first time in a week on Thursday, as China's strong demand offset concerns about the pace of interest rate hikes and slowing economic growth.
The US and European central banks said that inflationary pressures had not eased, suggesting that the central banks would continue to raise the interest rate, and then the global stock fell.
However, in China, the largest metal consumer, the central bank has relaxed its monetary policy. Besides, the low copper inventory and the premiums of imported copper suggest that demand is increasing.
LME three-month copper rose 1.3% to $8,028/mt. Copper prices dropped from the record high of $10,845 in March and once fell to $6,955 in July.
Robin Bhar, an independent analyst, said that low inventory and underlying demand from China should bring a bottom support to the prices.
China is the key to determining the prices, and the copper prices will be around $7,500/mt in 2022, said the analyst.
Yangshan copper premiums have risen to $102.50/mt, the highest since December 2021 and only $6.50/mt higher than the beginning of the year.
ANZ analysts said that China's increased infrastructure spending and support for the real estate industry shall boost the basic metal prices, but the rise was limited.
The zinc smelters was closed this week, and an aluminium smelter in Europe was shutdown due to high energy prices.
LME three-month zinc prices fell 0.6% to $3,491/mt.
According to the data released by the National Bureau of Statistics of China, output of copper cathode in July was 870,000 mt, a year-on-year increase of 2.1%. The output of primary aluminium (refined aluminium) rose to a record high of 3.43 million mt, up 5.6% year-on-year, thus aluminium imports decreased 38% year-on-year.
LME three-month aluminium prices fell 0.2% to $2,406.50/mt.
LME three-month nickel rose 1.2% to $22,155/mt; Three-month lead increased 0.8% to $2,133.50/mt; Three-month tin dropped 1.1% to $24,400/mt.