LONDON, Dec 3 (Reuters) – Copper eased on Friday as the dollar firmed after some aspects of an underwhelming U.S. jobs report showed that the Federal Reserve’s path to monetary policy tightening was still on course.
Markets were also on edge due to the Omicron variant of coronavirus, with countries introducing new restrictions to slow its spread, which could potentially derail the global economic recovery.
“Copper and other base metals are holding up well despite the bearish news like the new variant, China slowdown and potential tightening by the Federal Reserve,” said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.
He said he was advising clients to hedge and gain long exposure to the industrial metals complex.
Benchmark copper on the London Metal Exchange (LME) had lost 1% to $9,401 per tonne by 1717 GMT, set to end the week mostly unchanged.
A stronger U.S. currency makes dollar-denominated commodities more expensive for non-U.S. firms, a relationship used by funds to generate buy and sell signals.
DATA: U.S. jobs growth slowed, but data also showed positive revisions and solid details that suggested the Federal Reserve’s plan to accelerate tapering of its asset purchases and expectations for multiple rate hikes next year remained intact.
INVENTORIES: Visible stocks of copper in exchange warehouses eased, pointing to a firm demand for the metal used in power and construction.
In warehouses monitored by the Shanghai Futures Exchange, copper stocks shed 13.7% to 36,110 tonnes, according to weekly data.
Copper stocks in LME-registered warehouses, at 78,350 tonnes, are about a third of the levels registered in late August.
PERU: Miner MMG Ltd (1208.HK) said on Friday it would wind down copper production from its Las Bambas operations in Peru by mid-December after failing to establish commercial relationships with local community organisations.
The mine produced 400,000 tonnes of copper a year, about 2% of the total global output.