Copper prices extended overnight gains on Tuesday as a softer dollar and hopes of global economic recovery offset worries over possible price caps on industrial metals in top consumer China.
Three-month copper on the London Metal Exchange CMCU3 was up 1.2% at $10,067 a tonne by 0517 GMT.
London copper closed below $10,000 a tonne in the last two sessions amid a sell-off in industrial metals and has fallen more than 6% since touching a record high of $10,747.50 a tonne earlier this month.
In Shanghai, copper SCFcv1 rose 1.6% to 72,880 yuan ($11,368.14) a tonne.
“Copper rebounded, shrugging off China’s renewed angst against soaring commodities prices,” said Rodrigo Catril, a senior FX strategist at National Australia Bank in Sydney.
Prices of copper and other base metals fell last week and extended their losses in the early part of Monday’s session, after China warned against hoarding and speculation to cool a blistering rally in prices of industrial commodities.
“Although some of the rises in commodity prices has been driven by speculators, there is also a genuine increase in demand as the global economy reopens,” said Catril.
“So many think (China’s) measures to clamp down on speculators may not be enough to ease the price pressure.”
* The dollar held near a fourth-month low as investors tempered fears about inflation-driven rate hikes.
* A weaker U.S. currency makes greenback-denominated metals cheaper for holders of other currencies.
* China’s state planner said on Tuesday it would strengthen price controls of key commodities in its 14th five-year plan from 2021 to 2025.
* In London, aluminium CMAL3 advanced 0.3% to $2,393.50 a tonne, zinc CMZN3 rose 0.2% to $2,955.50/tonne, lead CMPB3 advanced 0.2% to $2,146/tonne, nickel CMNI3 added 0.1% to $17,135/tonne, and tin CMSN3 climbed 0.4% to $29,595/tonne.
* In Shanghai, aluminium SAFcv1 and zinc SZNcv1 were steady, nickel SNIcv1 rose 1.2%, lead SPBcv1 fell 1.2%, while tin SSNcv1 gained 0.9%.
Source: Reuters (Reporting by Enrico Dela Cruz in Manila; Editing by Ramakrishnan M.)