U.S. Markets close in 1 hr 7 mins
  • S&P 500

    4,197.23
    +74.76 (+1.81%)
     
  • Dow 30

    33,206.82
    +432.41 (+1.32%)
     
  • Nasdaq

    12,813.64
    +319.71 (+2.56%)
     
  • Russell 2000

    1,966.37
    +53.48 (+2.80%)
     
  • Crude Oil

    91.83
    +1.33 (+1.47%)
     
  • Gold

    1,807.80
    -4.50 (-0.25%)
     
  • Silver

    20.60
    +0.12 (+0.58%)
     
  • EUR/USD

    1.0309
    +0.0092 (+0.8969%)
     
  • 10-Yr Bond

    2.7860
    -0.0110 (-0.39%)
     
  • Vix

    19.70
    -2.07 (-9.51%)
     
  • GBP/USD

    1.2229
    +0.0153 (+1.2632%)
     
  • USD/JPY

    132.8530
    -2.2630 (-1.6749%)
     
  • BTC-USD

    23,599.30
    +552.21 (+2.40%)
     
  • CMC Crypto 200

    555.97
    +24.75 (+4.66%)
     
  • FTSE 100

    7,507.11
    +18.96 (+0.25%)
     
  • Nikkei 225

    27,819.33
    -180.67 (-0.65%)
     

Copper Prices Slump on Weak Chinese Factory Data, Gold Holds Steady

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·2 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

By Ambar Warrick

Investing.com -- Copper prices sank on Monday after weak Chinese factory data pointed to slowing demand for the metal, while gold prices steadied around three-week highs.

As of 09:13 pm ET (0113 GMT), Copper Futures fell 1.2% to $3.5503 a pound- near their lowest level in over one year.

Chinese factory output unexpectedly shrank in July as fresh curbs in the wake of rising COVID-19 cases dented economic activity. The official purchasing managers index (PMI) came in at 49 for July, below expectations of 50.4, and June’s reading of 50.2.

While the country’s overall business activity still remains in expansion territory, a drop in manufacturing bodes poorly for its import of commodities. Chinese demand accounts for a sizable portion of the global iron ore and base metals market. Oil prices also sank in reaction to the data.

Zinc Futures dropped 0.2% after the data, trading around $20.163 on Monday.

A potential crisis in China’s debt-saddled real estate market also points to more pressure on copper and iron ore prices this year, given their widespread use in the sector.

While metal prices had gained substantially this year on supply shocks from the Russia-Ukraine conflict, they have since consolidated sharply amid rising inflation and interest rates across the globe.

This, coupled with a potential economic recession, is also expected to damage metal demand through the remainder of the year. The U.S. economy shrank for two consecutive quarters this year, while the European Central Bank recently flagged a recession risk in 2022.

Amid an increasingly dire economic outlook, gold prices held steady after rising to a more-than three-week high last week. Spot gold XAU/USD traded at $1,763.64 a pound on Monday, down marginally from its previous close.

Other precious metals were also steady. Platinum Futures traded at $889.90, while Silver Futures were largely unchanged at $20.145. Still, the space is largely expected to come under pressure as U.S. interest rates rise further in 2022.

The Federal Reserve hiked rates by 75 basis points last week, and said that more raises were likely in the face of sky-high inflation.

Related Articles

Copper Prices Slump on Weak Chinese Factory Data, Gold Holds Steady

Oil drops as weak China factory data fan demand concerns

Oil Prices slip After weak Chinese data, OPEC+ Meeting Looms