Overnight copper prices rebounded, the People's Bank of China stated that it was determined to prevent the risk of exchange rate overshooting

Published: Aug 18, 2023 09:56

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LME copper prices closed at $8,234/mt overnight, a gain of 0.75%. Trading volume was 21,000 lots and open interest stood at 274,000 lots. The most active SHFE 2309 copper contract prices closed at 68,220 yuan/mt overnight, up 0.6%. Trading volumes stood at 26,000 lots and open interest stood at 152,000 lots.

On the macro front, the number of people applying for unemployment benefits in the United States recorded 239,000 in the week ending August 12, lower than the expected 240,000, indicating that the labour market remained tight. In addition, China's monetary policy implementation report stated that it will resolutely prevent the risk of exchange rate overshoot, and the yuan rebounded. In terms of fundamentals, the spot quotes in east China rose sharply, mainly due to the relatively tight spot cargoes and the drop in copper prices. Driven by low inventories, spot quotes in south China also rose sharply. Copper prices moved downward, boosting downstream demand. Copper prices will have limited upside room in the near future.

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