LONDON- Copper prices hit a two-week high on Friday and hit their strongest week since July on support from a weaker dollar and hopes that economic stimulus in top consumer China will boost demand.
Three-month copper on the London Metal Exchange was up 0.9 percent at $9,297.50 a metric ton after touching $9,314.5, its highest price since Aug 30. Aluminum and zinc also touched their two-week highs.
The US currency was under pressure, making dollar-priced metals more attractive for buyers using other currencies, with the US Federal Reserve widely expected to start cutting interest rates next week.
“One first rate cut is likely to boost sentiment in the base metals complex,” said Ewa Manthey, a commodities analyst at ING. “Longer term, weaker dollar and falling borrowing costs that will come with that cut will help demand, providing relief for construction and other interest-sensitive sectors.”
China’s central bank said on Friday that its policy would strive to expand domestic demand, focusing more on consumption. The country’s new bank loans growth in August missed expectations, though total social financing numbers, a gauge of future metals consumption, jumped and exceeded a Reuters poll forecast.
