Copper yesterday settled down by -0.34% at 644.2 as investors stayed on the sidelines ahead of expected interest rate hikes by central banks across the globe to tame surging inflation. The US Federal Reserve will lead the way with another outsized rate increase that markets fear would derail global growth and dampen metals demand. Copper prices, often used as the world’s economic barometer, also came under pressure from recession fears as Europe grapples with an energy crisis that thwarted manufacturing activity while China’s economic outlook and Covid trajectory remains highly uncertain. Meanwhile, easing Covid-19 restrictions and more policy support from China, which accounts for half of global consumption, kept prices from further losses. Goldman Sachs (NYSE:) also predicts that global demand for copper will begin to outstrip supplies by 2025, projecting prices to double from current levels.
weakened to a 26-month low of 7.0425, amid an imminent rate hike in the US as monetary policies between the world’s largest economies diverge further. Prior to market open, the PBoC set the midpoint rate at 7.0278 per dollar, the lowest since July 2020. In August, China’s central bank slashed its loan prime rate as policymakers seek to revive a Chinese economic recovery following the recent wave of COVID cases and sporadic restrictions in some big cities.
Technically market is under long liquidation as the market has witnessed a drop in open interest by -4.81% to settle at 4567 while prices are down -2.2 rupees, now Copper is getting support at 641.3 and below same could see a test of 638.3 levels, and resistance is now likely to be seen at 649, a move above could see prices testing 653.7.
Trading Ideas:
# Copper trading range for the day is 638.3-653.7.
# Copper dropped as investors stayed on the sidelines ahead of expected interest rate hikes by central banks across the globe to tame surging inflation.
# Copper prices, also came under pressure from recession fears as Europe grapples with an energy crisis that thwarted manufacturing activity.
# Goldman Sachs also predicts that global demand for copper will begin to outstrip supplies by 2025, projecting prices to double from current levels.
Read More: Copper Dropped As Rate Hikes By Central Banks Weighed On Sentiments
