LME copper prices closed at $8,372/mt overnight, a rise of 0.95%. Trading volumes were 17,000 lots and open interest stood at 252,000 lots. The most active SHFE 2307 copper contract finished at 67,000 yuan/mt overnight, up 0.34%. Trading volume was 37,000 lots and open interest stood at 185,000 lots.
On the macro front, the data showed that the number of jobless claims in the US topped expectations last week. The US labour market cooled and the US dollar index fell. However, the market generally believes that the Fed's rate hike path is still unclear before the key inflation data is released. Spot quotes in east China remained high, and downstream buying interest was weak.
The price spread between the SHFE front-month and SHFE next-month copper contracts is unlikely to expand. The spot market transactions were sluggish yesterday. The inventory in south China increased, mainly due to the increase in arrivals and the decrease in outbound shipments. Sellers adjusted prices but downstream buying interest was weak. The overall transaction was relatively quiet.
On the whole, there were many smelters undertaking maintenance in June, and the supply of goods in the market was tight. But the downstream demand was also weak. Copper prices are expected to remain strong in the short term amid growing expectations of a pause in Fed rate hike in June.
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