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Copper slides to 11-week low after China inflation data

Published 09/11/2014, 03:25 AM
Updated 09/11/2014, 03:25 AM
Copper futures tumble to 11-week low after China inflation data

Investing.com - Copper futures tumbled to an 11-week low on Thursday, after data showed that Chinese inflation in August slowed more than expected, underlining concerns over the health of the world's second biggest economy.

On the Comex division of the New York Mercantile Exchange, copper for December delivery fell to $3.072 a pound, a level not seen since June 20.

Prices recovered to last trade at $3.075 during European morning hours, down 3.5 cents, or 1.13%.

A day earlier, copper prices tacked on 0.8 cents, or 0.27%, to settle at $3.110 a pound.

Futures were likely to find support at $3.052, the low from June 19 and resistance at $3.120, the high from September 10.

Official data released earlier showed that Chinese inflation for August slowed to 2.0% on-year from 2.3% in July, below expectations for a reading of 2.2%.

The weaker than expected data underlined concerns about China's economy and sparked speculation policymakers in Beijing will have to introduce fresh stimulus to meet the government's 7.5% growth target.

China is the world's largest copper consumer, accounting for nearly 40% of global demand.

Elsewhere on the Comex, gold for December delivery tacked on 0.4%, or $5.00, to trade at $1,250.30 a troy ounce, while silver for December delivery picked up 0.06%, or 1.2 cents, to trade at $18.94 an ounce.

U.S. President Barack Obama said in an address to the nation Wednesday that the U.S. would conduct a "systematic campaign" of airstrikes against Islamic State militants in Syria.

Market players looked ahead to the release of key U.S. data later in the session for further indications on the strength of the economy and the future path of monetary policy.

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Later in the day, the U.S. was to produce the weekly report on initial jobless claims.

The dollar remained well bid amid speculation Federal Reserve officials could adopt more hawkish language at their policy meeting next week, possibly by omitting mention of its commitment to keep rates low for a "considerable time".

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