(Bloomberg) — Base metals edged lower as investors waited for a bundle of US economic data that’s been delayed by the government shutdown.
Copper fell for a third session in a row on the London Metal Exchange, falling for a third session in a row. Traders are losing confidence in a December rate cut as Federal Reserve officials show little conviction for reducing borrowing costs. Lower interest rates can benefit commodities like copper by lifting demand and weakening the dollar, making the metal more affordable for buyers in different currencies.
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A six-week absence of reliable statistics on the American labor market and inflation has made some Fed officials increasingly reluctant to commit to another rate cut next month. Views are now split, after a quarter-point reduction being all but priced in less than a month ago.
Traders were also monitoring an intensifying diplomatic spat between China and Japan. The commodities trade between the two major economies could be affected if tensions rise further.
Copper futures on the LME traded 0.7% lower to settle at $10,778.50 a ton in London. Aluminum fell 1.6% to the lowest in nearly a month. All other metals except tin declined.
–With assistance from Yvonne Yue Li.
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