METALS-Copper on track for first weekly loss in over a month on credit worries

(Updates prices)

HANOI, May 14 (Reuters) – Copper prices fell on Friday, with the London contract set for its first weekly decline in more than a month, on worries of tightening credit that could potential cap demand for the metal.

Three-month copper on the London Metal Exchange fell 0.7% to $10,271 a tonne by 0706 GMT, down 1.4% on a weekly basis, its first decline since the week ended April 2.

The most-traded June copper contract on the Shanghai Futures Exchange closed down 1.9% at 74,560 yuan ($11,589.70) a tonne.

“Supply will improve, while we note credit impulse data in the United States and China is easing, which will help demand taper off later this year and next,” said Fitch Solutions in a report.

“Metal prices will ease later in the year as the ongoing supply-demand mismatch eases.”

A metal trader added that there is some liquidation prior to the weekend and base metals prices also fell in accordance with a sharp sell-off in the ferrous market.

China’s new bank loans fell more than expected in April while money supply growth slowed to a 21-month low, as the central bank gradually scales back pandemic-driven stimulus to reduce debt and financial risks in hot areas of the economy.

Earlier this week, China’s state council said the country, the world’s biggest metals consumer, will monitor changes in overseas and domestic markets and effectively cope with a fast increase in commodity prices, without specifying how.

Both copper contracts hit their record high on Monday.


* LME aluminium fell 0.5% to $2,440.50 a tonne while ShFE aluminium fell 2% to 19,315 yuan a tonne, nickel dropped 1.3% to 128,770 yuan a tonne and lead shed 2.2% to 15,055 yuan a tonne.

* Russian metals producer Nornickel has resumed full operations at its nickel-copper Oktyabrsky mine hit by flooding this year.

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