Copper tumbled to 2.115 after a mid-week rally falling 2.20% after Brexit. The US dollar rallied on safe haven moves. copper and other industrial metals
Copper tumbled to 2.115 after a mid-week rally falling 2.20% after Brexit. The US dollar rallied on safe haven moves. copper and other industrial metals fell on Friday as worries about economic growth rose following the British vote to leave the European Union, and as the dollar soared.
But despite broad-based declines, which saw zinc and tin fall to three-week lows, the moves were not as strong as in other commodities and the market recouped much of its losses by the close.
Analysts said this was partly due to the key role of China, the world’s biggest metals consumer.
“Of course, there are implications for EU growth, which would be negative for metals, and a strong dollar is another negative,” said Caroline Bain, senior commodities economist at Capital Economics in London.
“But I suppose since because China is primarily the main demand force for industrial metals, there’s the feeling it’s not going to have a massive impact on the (supply-demand) fundamentals,” Bain said.
Highlighting the impact that stimulus has had on the Chinese economy, a survey on Friday showed business confidence among entrepreneurs in China has picked up for the first time in more than two years in the second quarter of 2016.
Traders said the relatively subdued reaction of base metals may also be due to the fact investors have already withdrawn a lot of capital from the downtrodden sector, where prices are stuck around the cost of production after years of oversupply.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.
Major Economic Events for the week:
Cur. | Event | Actual | Forecast | Previous | |||||
Tuesday, June 28, 2016 | |||||||||
USD | GDP (QoQ) (Q1) | 1.0% | 0.8% | ||||||
USD | CB Consumer Confidence (Jun) | 93.3 | 92.6 | ||||||
Wednesday, June 29, 2016 | |||||||||
USD | Pending Home Sales (MoM) (May) | -1.1% | 5.1% | ||||||
USD | Crude Oil Inventories | -0.917M | |||||||
Thursday, June 30, 2016 | |||||||||
GBP | GDP (QoQ) (Q1) | 0.4% | 0.4% | ||||||
GBP | GDP (YoY) (Q1) | 2.0% | 2.0% | ||||||
EUR | CPI (YoY) (Jun) | -0.1% | |||||||
CAD | GDP (MoM) (Apr) | 0.1% | -0.2% | ||||||
Friday, July 1, 2016 | |||||||||
Canada – Canada Day | |||||||||
JPY | Tankan Large Manufacturers Index (Q2) | 4 | 6 | ||||||
JPY | Tankan Large Non-Manufacturers Index | 19 | 22 | ||||||
CNY | Manufacturing PMI (Jun) | 50.0 | 50.1 | ||||||
CNY | Caixin Manufacturing PMI (Jun) | 49.2 | 49.2 | ||||||
GBP | Manufacturing PMI (Jun) | 50.2 | 50.1 | ||||||
USD | ISM Manufacturing PMI (Jun) | 51.5 | 51.3 | ||||||
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