LONDON (Reuters) – The trade war trade has returned with a vengeance as copper and other industrial metals come under sustained fund selling pressure.
On the London Metal Exchange (LME) three-month copper fell 11% from $6,443 a tonne at the start of May to a June 7 low of $5,740, its weakest price since the start of January.
It has clawed its way back to $5,920 but with bearish funds still massing on the short side it remains to be seen whether this is anything other than a pause for collective breath.
Current market dynamics are a rerun of the price weakness in the third quarter of last year, with investors again focused on a deteriorating macroeconomic picture and the knock-on effect on metals demand.
And once again macro clouds are obscuring copper’s own resilient fundamentals in the form of weak mine production growth and supply chain disruption.