(Updates prices, adds comment, detail; previous MELBOURNE)
* Dollar gains slightly vs basket of currencies
* China demand soft ahead of Lunar New Year -traders
* Coming up: U.S. import/export prices for Dec at 1330 GMT
By Harpreet Bhal
LONDON, Jan 11 (Reuters) – Copper prices slipped on Friday
from a one-week high hit a day earlier following strong Chinese
export data, with a slightly weaker dollar and uncertainty about
the outlook for demand for industrial metals weighing on prices.
Benchmark copper on the London Metal Exchange
slipped to $8,087.50 a tonne at 1050 GMT, down 0.4 percent from
a close of $8,110 a tonne on Thursday.
It hit a one week high of $8,165 in the previous session
after China’s export growth rebounded surprisingly sharply to a
seven-month high in December, but subdued global demand means
the spike may not herald an enduring recovery.
“Looking further ahead into the second half of this year,
there is the potential for Chinese growth to be weaker than some
expect,” said Ross Strachan, economists at Capital Economics.
“I don’t think the upturn in demand (for metals in the
second half) will be as great or last as long as it has in
recent times.”
Weighing on prices was a rise in the dollar against a basket
of currencies. A strong dollar makes commodities priced in the
U.S. unit more expensive for holders of other currencies.
The metal used in power and construction, which gained more
than 4 percent in 2012, hit its highest level in more than
two-month earlier in January following a deal by U.S lawmakers
to avoid a “fiscal cliff” of spending cuts and tax increases.
But prices have since retreated on expectations that the
U.S. Federal Reserve may rein in easing measures sooner than
expected, and caution ahead of more U.S. debt ceiling
negotiations that are set to take place in coming months.
“The fiscal cliff has passed but you have the issue of the
debt ceiling looming and that it clearly is a downside risk for
the market,” Strachan said.
LUNAR NEW YEAR
The market’s focus remains on the outlook for demand from
China, the world’s top consumer of copper, with traders
expecting Chinese purchases of metals to stay quiet until March
when factories reopen following mid February’s Lunar New Year
holiday.
“I contacted some potential customers this week, all said
they were busy with the year-end paperwork. Nobody really wants
to talk about business. They all said wait till Chinese New Year
is over,” said a Hong Kong-based trader.
Factory activity in China is likely to shut or slow
operations for a couple of weeks around the holiday on February
10.
Benchmark zinc fell to $2,035.25 from Thursday’s
close of $2,038 while aluminium was at $2,119 from
$2,114.
Lead slipped to $2,330.50 from a last bid of $2,333,
tin slipped to $24,650 from $24,655 and nickel,
was at $17,456 from $17,400.
Metal Prices at 1053 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2012 Ytd Pct
move
COMEX Cu 367.20 -3.00 -0.81 365.25 0.53
LME Alum 2119.00 5.00 +0.24 2073.00 2.22
LME Cu 8086.00 -24.00 -0.30 7931.00 1.95
LME Lead 2329.00 14.00 +0.60 2330.00 -0.04
LME Nickel 17456.00 56.00 +0.32 17060.00 2.32
LME Tin 24631.00 -24.00 -0.10 23400.00 5.26
LME Zinc 2035.25 -2.75 -0.13 2080.00 -2.15
SHFE Alu 15250.00 -20.00 -0.13 15435.00 -1.20
SHFE Cu* 58250.00 -290.00 -0.50 57690.00 0.97
SHFE Zin 15365.00 -50.00 -0.32 15625.00 -1.66
(Additional reporting by Melanie Burton in Melbourne, editing
by William Hardy)
