HANOI — Copper rose on Friday in London, as the dollar weakened, but the contract was set for a weekly decline on fears that China will introduce limits on commodity prices.
Three-month copper on the London Metal Exchange rose 0.2% to $9,907 a tonne by 0519 GMT, but it was down 0.5% for the week.
The most-traded July copper contract on the Shanghai Futures Exchange declined 0.6% to 71,070 yuan ($11,128.68) a tonne
After a week of anxious waiting, markets got the high U.S. inflation number they dreaded, shrugged it off and moved on – leaving the U.S. dollar under pressure, which made greenback-priced metals cheaper and more attractive to holders of other currencies.
“We expect near-term stabilization after copper and aluminum, especially, reached fresh-new highs in May,” said Fitch Solutions analysts in a note.
“Nevertheless, there should be no collapse and prices will remain elevated compared to previous years, on the back of a weakening U.S. dollar, tight fundamentals and positive investor sentiment due to the ongoing global economic recovery.”
However, copper was under pressure as authorities in China, the world’s top consumer of the metal, vowed to control a surge in commodities prices, as producer inflation in May hit its highest in over 12 years.
* LME aluminum rose 0.6% to $2,490.50 a tonne and lead advanced 0.7% to $2,190 a tonne. ShFE aluminum climbed 2.3% to 18,930 yuan a tonne and ShFE nickel increased 2.2% to 135,060 yuan a tonne.
* China is looking to release 800,000-900,000 tonnes of primary aluminum from its state reserves as soon as next month to ease high prices for the metal, consultancy CRU said in a note to clients, citing local market contacts.
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($1 = 6.3862 yuan) (Reporting by Mai Nguyen; editing by Uttaresh.V and Rashmi Aich)