Copper rises to three-week high on weaker dollar before election results
Updates official prices
By Julian Luk
LONDON, Nov 5 (Reuters) -Copper prices rose on Tuesday to a 22-day high on a softer dollar as traders balanced their positions ahead of the outcome of the U.S. presidential election and on stimulus cues from top metals buyer China.
Three-month copper on the London Metal Exchange (LME) CMCU3 was up 0.3% to $9,724 per metric ton during official rings. It touched $9,774 earlier for the highest price since Oct. 14.
Volumes are relatively thin for the base metals complex as investors brace for volatility in the coming few sessions until a clear winner of the U.S. election is declared, a trader said.
The U.S. currency weakened DXY this week after a weekend opinion poll showed Democratic Vice President Kamala Harris with a surprise lead in Iowa, a traditional Republican stronghold.
Dollar traders had priced in a victory for Republican former President Donald Trump, whose tariff and immigration policies analysts say are more inflationary. Last week the dollar index surged to a three-month high at 104.63.
A weaker dollar makes the greenback-priced metals cheaper for holders of foreign currencies, and typically provides support to metal prices.
But the market remained cautious over a potential second term for Trump, who could reintroduce tariffs that threaten to dampen global base metals trading activity like in 2019.
Back then, the Sino-U.S. trade war caused major diversion of copper and aluminium scrap shipments, disrupting trade flows of secondary material.
China is more prepared for the headwinds this time.
According to Reuters, China is considering approving an extra stimulus package to save the economy if Trump wins.
A meeting this week of the standing committee of China's National People's Congress will shed more light on the stimulus measures.
In other metals trading, zinc rose 1.2% to $3,071a ton. A South Korean court upheld an order to suspend Young Poong's 00670.KS Seokpo zinc smelter, the world's sixth-largest, due to improper waste water discharge, the operator said.
Aluminium also gained 0.7% to $2,639.Chinese social inventory dropped to an eight-month low of 585,000 tons, according to SMM. SMM-ALU-CON
Nickel CMNI3 climbed 1.3% to $16,220, lead CMPB3 increased 0.5% to $2,044 and tin CMSN3 was unchanged at $32,150.
text_section_type="notes"> For related news and prices, click on the codes in brackets:
LME price overview RING= COMEX copper futures 0#HG:
All metals news MTL All commodities news C
Foreign exchange rates FX= SPEED GUIDES LME/INDEX
Reporting by Julian Luk; Editing by Emelia Sithole-Matarise and Paul Simao
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