Copper prices fell in August amid a weak demand backdrop and stronger supply. The price averaged USD 8,348 per metric ton in August, 1.5% lower than July’s price but up 4.5% year on year. On 31 August, copper traded at USD 8,405 per metric ton, down 4.5% month on month.
In August, demand conditions deteriorated, as signaled by pessimistic August manufacturing PMI readings in the U.S. the Eurozone and China—the largest consumer of the metal. The Asian giant has lost economic dynamism in recent months, and recent policies—such as interest rate cuts—and government promises of stimulus programs have not sufficed to strengthen the country’s industrial sector. Additionally, the dollar gained ground in August, which made the metal more expensive for holders of other currencies, thus weighing on demand. On the supply side, output rose markedly in June in top producer Peru, as the impact of social unrest dissipated, which put further downward pressure on prices.
Copper LME (prices in US$/mt, aop)
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