LONDON: Copper edged up on Tuesday from a near 2-month low hit the previous session, helped by a weaker dollar and as lower prices encouraged some timid industrial buying, but concerns about soft demand from top consumer China capped gains. Three-month copper on the London Metal Exchange was 0.9 percent up at $7,768 by 0953 GMT, recovering somewhat from a low of $7,670 on Monday, its lowest level since Sept. 5. Trading volumes were low however, as Sandy, one of the biggest storms ever to hit the US, forced evacuations and shut down transportation. Still, with prices of most metals near 2-month lows on Monday, traders noted some industrial buyers had been tempted. "We are seeing a bit more buying interest from consumers at this sort of price levels but we still see copper physical demand as relatively soft," Standard Chartered analyst Daniel Smith said. "I don't think demand in China has got any worse, but people are recognising that growth in quite soft. Realism is starting to sink in." Copper is broadly flat on the year, having given back almost all its gains in recent weeks after a steep rise in September, when Europe and the United States implemented looser monetary policies. These kind of policies tend to inflate the value of hard assets such as commodities, because the relative value of paper currency falls as more cash enters circulation. Helping industrial metals, the euro rose against the dollar helped by lower Spanish and Italian bond yields. A softer US currency makes dollar-priced commodities such as metals cheaper for holders of the single currency.

Source