Stronger Dollar Weighs on Copper Prices Amid Supply Concerns
Copper prices declined on Thursday due to a stronger dollar and reduced risk ahead of China's long Mid-Autumn Festival weekend. The benchmark three-month copper price on the London Metal Exchange dropped 0.2% to $14,595 per metric ton by 1405 GMT.
This decline comes despite supply concerns at major Chilean mines, including BHP's Escondida mine and Antofagasta Minerals' Centinela copper mine. Operations were suspended at Escondida after a worker was killed in an accident, while unions representing workers at Centinela called for a strike vote amid ongoing contract negotiations.
A stronger US currency makes dollar-priced metals more expensive for buyers using other currencies, and the prospect of higher borrowing costs affects sentiment towards growth-dependent metals like copper. The premium of the LME cash copper contract over the three-month benchmark widened to $107.5 per ton, signaling tightness in nearby supply.