WEAK DEMAND SINKS COPPER PRICES
Written by Millennium on September 11, 2019
SUN BUSINESS REPORTER writes
@SunZambian
COPPER prices on London Metal Exchange (LME) slipped on Monday as expectations of weak demand in top consumer China were reinforced by data showing a surprise fall in its exports.
But losses were limited by the likelihood of policy stimulus to shore up growth, according to Barclays Bank Zambia daily market update.
Benchmark copper on LME ended down 0.3percent to $5,815 a tonne.
Prices of the metal, used widely in power and construction industries, hit $5,518 last week, the lowest in more than two years.
On gold, the bank reported that prices inched lower on Monday as equities rose, but policy easing expectations by major central banks gathered momentum, amid soft economic data, which kept prices steady over the psychological level of $1,500.
Spot gold eased 0.1percent to $1,505.20 per ounce, having fallen nearly 1percent in the previous session. U.S. gold futures also dipped 0.1percent to $1,514.1 an ounce.
In the same report, oil futures rose on Tuesday, potentially heading for a fifth day of gains, amid optimism that OPEC and other countries may agree to extend production cuts in a bid to support prices.
Brent was up 42 cents, or 0.7percent, at $63.01 a barrel.
On the local scene, Barclays reported that the Zambian Kwacha opened the week on the back foot as importers continued to take advantage of last week’s minor gains in the currency coupled with improved liquidity in the local money market.
Having traded stable during most of the previous sessions, the Kwacha was quoted at K13.150/13.200 at the close of the market at 15:30 hours down from Friday’s close of K13.140/13.190.
Near term the local unit is anticipated to be on the defensive as dollar demand picks up.
The liquidity levels improved further on Monday to close at K1,983.67 billion from K1,878.06 billion seen on Friday.
In the same vein the volumes of funds traded on the interbank pushed up to K240.00 million from K215.00 million with the overnight interbank lending rate remaining unchanged at 11.27percent on the day.
On fixed income, the local market witnessed little traded in the secondary market on Monday with yields remaining relatively unchanged on the day.
