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[HONG KONG] Copper traded near US$6,000 a metric ton before data forecast to show US manufacturing is losing traction amid slower growth in the China, the biggest consumer.
Copper in London slid as much as 0.6 per cent, extending May's 5.1 per cent decline, the first monthly loss since January. US manufacturers' new orders dropped 0.1 per cent in May from a gain of 2.1 per cent in April, according to a survey of economists before the figures on Tuesday. China's economy has slowed below the government's 7 per cent target rate in recent months, according to Bloomberg's monthly growth tracker.
"A drop in US manufacturing would be a bad news for copper," said Xiao Jing, an analyst at Beijing Capital Futures Co. "Investors have also started to question the effectiveness of China's monetary easing."
Copper for delivery in three months on the London Metal Exchange fell 0.2 per cent to US$6,014 a ton (US$2.73 a pound) by 11.15 am in Hong Kong. In New York, copper on the Comex was little changed at $2.7235 a pound, after dropping for a sixth day on Monday, the longest run of losses in more than a year. In Shanghai, the metal for August fell 0.3 per cent to 43,530 yuan (US$7,023) a ton.
A lack of supply disruptions in the last month may add to a forecast global surplus this year of the metal, analysts at Barclays Plc said in a report Monday. China's new low-voltage cable standards starting Sept 1 may accelerate a switch from copper to aluminum alloy, Goldman Sachs Group Inc. said in a separate report the same day.