(Bloomberg) -- Base metals snapped their rallies amid a strong dollar, lingering demand worries and uncertainty about the Federal Reserve’s monetary easing path.
Aluminum fell from its highest level since mid-June, with copper also on track for its biggest single-day loss in almost a month.
“The upside to industrial metals prices is capped by macro drivers, including ongoing demand concerns in China,” said Ewa Manthey, commodities strategist at ING Bank NV. “Prices are likely to remain volatile looking further ahead.”
Chinese demand for industrial metals has been buffeted by the country’s deep property slowdown and weak economic confidence. Data released Monday showed aluminum stockpiles at their highest level for this time of year since 2019.
Spot aluminum ingot is also trading at a discount to local futures benchmark, signaling soft market characteristics.
Traders are shifting attention to US inflation figures due Friday, which may offer clues on how rapidly rates will be cut after Fed Chair Jerome Powell said the “time has come” to ease policy.
Copper declined 1.9% to $9,270 a ton by 4:38 p.m. in London. All other industrial metals fell on the LME, with aluminum down 2.3%.
European equity markets were mostly in positive territory, and the dollar was little changed.
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