METALS-Slumping dollar boosts base metals, zinc hits 3-year high
(Updates throughout, moves dateline from HANOI)
LONDON, May 18 (Reuters) – Most industrial metals prices rose on Tuesday as investors betting on a long period of low interest rates bought riskier assets, pushing global stock markets higher and dragging the dollar to its weakest since February.
The weaker greenback helps dollar-priced metals by making them cheaper for buyers with other currencies.
Benchmark copper on the London Metal Exchange (LME) was up 0.9% at $10,462 a tonne by 1042 GMT and near last week’s record high of $10,747.50.
LME zinc was up 2.3% at $3,084.50 a tonne after surging to $3,108.50, its highest since June 2018.
Lurking in the background are concerns that major producers Peru and Chile will raise taxes on mining companies, potentially squeezing supply, said Commerzbank analyst Daniel Briesemann.
But he said industrial metals prices had overshot and would likely dip in the second half of the year, with zinc falling to around $2,600-$2,700.
FED: Dallas Federal Reserve President Robert Kaplan reiterated that he does not expect U.S. interest rates to rise until next year.
COPPER: The roughly 24 million tonne a year copper market will be undersupplied by around half a million tonnes this year and mostly balanced in 2022, the International Wrought Copper Council (IWCC) said.
CHINA: China’s state planner said it would take measures to stabilise steel and iron ore markets after prices shot up.
ALUMINIUM: Analysts at Citi said the roughly 65 million tonne a year aluminium market would be undersupplied by 480,000 tonnes in 2022 and 1.08 million tonnes in 2023.
“We now see LME aluminium rising to $3,000 a tonne by the end of 2022,” they said. Benchmark LME aluminium was down 0.2% at $2,494 on Tuesday.
CHINA IMPORTS: China’s aluminium imports in April rose 36.1% from the previous month, customs data showed.
OTHER METALS: LME nickel was up 1.1% at $18,100 a tonne, lead was up 0.1% at $2,209.50 and tin was 0.7% higher at $30,090.
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