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METALS-Base metals fall on U.S. rate hike fears

METALS-Base metals fall on U.S. rate hike fears

Reuters · 09/13/2022 22:20
METALS-Base metals fall on U.S. rate hike fears

- Base metal prices fell on Wednesday after a hotter-than-expected U.S. inflation report triggered fears of more aggressive Federal Reserve interest rate hikes that could dampen metals demand.

Three-month copper on the London Metal Exchange CMCU3 had fallen 0.7% to $7,817.50 a tonne by 0156 GMT, extending losses from the previous session.

The most-traded October copper contract on the Shanghai Futures Exchange SCFcv1 slid 1.4% to 62,260 yuan ($8,941.55) a tonne.

Data released late on late Tuesday showed U.S. consumer prices unexpectedly rose in August, with such prices rising at an annual pace of 8.3%, far from the four-decade peak reached in June.

The dollar strengthened further after the CPI shock, posting its biggest daily percentage gain since 2020.

A firm dollar pressures commodities priced in the greenback by making them more expensive for holders of other currencies.

Tuesday's data also slammed stock and bond prices. Major Wall Street indexes saw their biggest daily percentage declines since June 2020.

LME tin CMSN3 dropped 3.6% to $20,620 a tonne, zinc CMZN3 declined 0.4% to $3,215 a tonne and aluminium CMAL3 dipped 0.2% to $2,309.50 a tonne.

ShFE SNIcv1 lost 1.7% to 188,830 yuan a tonne, tin SSNcv1 shed 4.8% to 173,250 yuan a tonne, aluminium SAFcv1 was down 0.8% to 18,640 yuan a tonne, zinc SZNcv1 declined 0.2% to 24,760 yuan a tonne and lead SPBcv1 dropped 1.1% to 14,975 yuan a tonne.

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($1 = 6.9630 Chinese yuan)

(Reporting by Siyi Liu and Dominique Patton; Editing by Subhranshu Sahu)


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