Copper Prices Rebounded On Falling US Dollar Index

Published: Jun 16, 2023 10:05

Source: SMM

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LME copper closed with a gain of 0.44% at $8,563.5/mt overnight. Trading volume stood at 22,000 lots. Open interest stood at 253,000 lots. SHFE 2307 prices fell slightly copper contract finished at 68,330 yuan/mt last evening, up 0.57%. Trading volume was 28,000 lots, and open interest stood at 190,000 lots.

On the macro front, the European Central Bank raised interest rates for the eighth time in a row and signalled further tightening to bring the inflation rate in the eurozone to the medium-term target of 2%. The euro against the US dollar hit a five-week high as the US dollar plunged.

In terms of fundamentals, the market trading was quiet due to the delivery of the SHFE June copper contract. Affected by the price spread between the SHFE front-month and next-month copper contracts, it is expected that spot quotes will rise further. But downstream acceptance of high premiums will weaken. Import losses continued to expand, which may bring export opportunities for smelters. In south China, due to the widening price spread between the SHFE front-month and next-month copper contracts, downstream buying interest was weak. And sellers refrained from selling at lower prices, keeping muting overall trading. Downstream demand will remain weak.

Copper prices strengthened due to weaker US dollar.

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