The price of copper slipped sharply on Wednesday, losing more than 4% to $2.7170 or $5,990 a tonne on the Comex market, its lowest level since July 20 last year. MCX Copper also tasted blood during the day. For COMEX it was one of the busiest days of 2018 on commodity futures markets with with over 2.1 m tonnes of copper worth $12.7 billion exchanging hands. Wednesday was the ninth down day of the last 10 trading sessions for copper. The bellwether metal has declined by 18.5% just over the last month, dragging the base metal complex down with it.
The trade dispute between the US and China, responsible for half the world's consumption of copper, is quickly escalating and comes on top of sliding indicators of manufacturing and industrial activity in China. Due to its widespread use in manufacture, construction and electricity infrastructure, the copper price is often considered a gauge of broader economic activity.
China could also limit visits to the United States by Chinese tourists, a business state media said is worth $115 billion, or shed some of its US Treasury holdings, Iris Pang, Greater China economist at ING in Hong Kong, wrote in a note.
The $200 billion far exceeds the total value of goods China imports from the United States, which means Beijing may need to think of creative ways to respond to such US measures.
Indian Copper was hammered on Wednesday as prices were tormented by 2.86% to end the day at Rs 420.7 per kg. Further declines may lead the metal to move towards Rs 405 per kg.
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