Maravi

Copper prices plummet to 6-month low

COMMENT - $7200 per tonne is still over $5000 higher than when the mines were state owned. And the private sector is complaining?

Copper prices plummet to 6-month low
By Gift Chanda
Mon 25 June 2012, 13:25 CAT

COPPER prices dropped to a six-month low on Friday around US$7,200 a tonne on concerns of a shaky economic outlook. The metal was weighed-down by fresh concerns on the future global economic performance which were triggered by weak German and US data and a downgrade of some of the world's leading banks.

Three-month copper on the London Metal Exchange touched a session low of US$7,219.50 a tonne, its weakest since December 19, 2011. In earlier sessions, copper was hovering around US $7,281 a tonne.

Investors have been sitting on the fence after China's factory sector shrank for an eighth straight month, business activity in the euro area contracted for a fifth month and US manufacturing grew at its slowest pace in 11 months.

German business sentiment fell to its lowest level in more than two years, and Moody's cut the credit ratings of 15 global banks, including JPMorgan and Morgan Stanley, according to media report.

Meanwhile, the kwacha is expected to hold against the dollar this week after posting marginal gains last week.

The local currency traded at K5160 and K5180 per dollar for bid and offer, respectively.

Barclays Bank market experts stated that there had been notable reduction in dollar demand last week against spurts of supply flows.

"Outlook for the medium term continues to point to a stable local unit given that the economy remains strong with average growth forecast at 6.9 per cent this year and 7.1 per cent next year on the back of strong performances in the construction, manufacturing and tourism sectors driven by persistently strong FDI inflows," the bank stated in its daily market update released Friday.

Labels: COPPER

posted by MrK @ 2:54 PM