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Copper slides to fresh 6-year low after China data disappoints

Published 11/11/2015, 08:10
Updated 11/11/2015, 08:13
Copper prices fall to lowest since July 2009
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Investing.com - Copper prices declined for the seventh straight session on Wednesday to hit the lowest level since July 2009 after the latest industrial production figures out of China added to concerns over the health of the world's second-biggest economy.

Copper for December delivery on the Comex division of the New York Mercantile Exchange declined 1.6 cents, or 0.74%, to trade at $2.201 a pound during morning hours in London. It earlier fell to $2.203, a level not seen in more than six years.

A day earlier, copper prices dipped 1.2 cents, or 0.56%, amid ongoing concerns over the health of China's economy.

The National Bureau of Statistics said that industrial production rose by an annualized rate of 5.6% in October, below expectations for a 5.8% increase and slowing from a gain of 5.7% in the preceding month.

The soft data followed disappointing Chinese trade and inflation figures earlier in the week.

The downbeat reports reinforced the view that the economy remains in the midst of a gradual slowdown which will require policymakers in Beijing to roll out more measures to boost growth in coming months.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption.

Elsewhere in metals trading, gold prices struggled near three-month lows, as market players prepared for a hike in interest rates by the Federal Reserve next month.

Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.

The U.S. dollar held near seven-month highs against a basket of six other major currencies amid expectations for tighter monetary policy in the U.S. in the coming months.

Dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.

Investors looked ahead to key U.S. data later in the week for further indications on the strength of the economy and the likelihood of a near-term rate hike.

The U.S. is slated to release data on retail sales, producer prices and consumer sentiment on Friday.

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