SHANGHAI, May 20 (SMM) – LME copper tested a low of USD 6,200/mt and posted a 2.4% fall to USD 6,225/mt, as the US dollar index rebounded 1.2% and gold and crude oil both dropped.
European Central Bank official said the central bank will accelerate the QE, causing the euro to weaken against the dollar. Euro bond yields also tumbled, with German bond yields down more than 10%. In addition, the housing market released by the US Commerce Department showed the country’s housing starts increased 20.2% in April, the biggest growth since February 1991. The US dollar index presented a strong rebound as a result.
In other news, UK’s CPI dropped 0.1% YoY in April, the first slide since the data were recorded by the Office for National Statistics in 1996.
SHFE 1507 copper contract prices gapped lower at RMB 45,320/mt for night session Tuesday, and dropped to RMB 44,710/mt before closing the session at RMB 44,810/mt, down by RMB 1,000/mt. Positions decreased 3,888 and trading volumes grew to about 210,000 lots. Technical indicators pointed to further decline in copper prices.
SHFE 1507 copper contract is expected to trade at RMB 44,500-45,000/mt on May 20. Spot copper may be offered at premiums of RMB 70-150/mt to SHFE 1506 copper contract in Shanghai.
