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Copper prices declined slightly on Wednesday after US consumer prices data for August showed the biggest increase in more than a year, which could keep interest rates higher for longer and support the dollar.
Three-month copper on the London Metal Exchange (LME) was down 0.2% at $8,371 per metric ton in open-outcry trading.
The U.S. consumer price index increased by 0.6% last month, the largest gain since June 2022, the Labor Department said on Wednesday. The CPI had risen by 0.2% for two straight months.
A stronger U.S. currency makes dollar-priced metals costlier for holders of other currencies, which could weigh on demand.
Trading is expected to remain light before European interest rate decision tomorrow, said Alastair Munro, senior base metals strategist at Marex.
Munro added that industrial metals prices would be dominated by wider factors such as the dollar’s performance against the Chinese yuan.
Concern over industrial metals demand in China has been a feature for some months despite Beijing issuing a series of supporting measures to revive a troubled property market.
Chinese data on house prices, urban investment and industrial production data this week should provide a steer on the direction of industrial metals demand and prices.