FX:Copper futures edge lower on sustained euro zone debt woes
Forexpros - Copper futures were lower during European morning hours on Thursday, as ongoing concerns over the euro zone’s deepening sovereign debt crisis reduced the appeal of growth-linked assets.
Losses were limited amid expectations policy makers around the world will implement stimulus measures to help spur weak global growth.
On the Comex division of the New York Mercantile Exchange, copper futures for September delivery traded at USD3.356 a pound during European morning trade, shedding 0.55%.
It earlier fell by as much as 0.6% to trade at a session low of USD3.354 a pound. Prices hit a one-month low of USD3.332 a pound on Wednesday.
Sentiment on the euro was hit by sustained concerns that Spain may require a full-scale sovereign bailout and Greece may exit the euro zone.
The yield on Spanish 10-year bonds was at 7.38% on Thursday, below Wednesday’s euro-era high of 7.74%, but still above the critical 7% threshold, widely considered unsustainable in the long term.
Meanwhile, the European Central Bank said earlier that private sector deposits at Greek banks fell 4.1% on the month in June, to the lowest level since October 2005, as political turmoil shook investor confidence.
Europe as a region is second in global demand for the industrial metal. Prices have tracked investor sentiment toward the euro zone’s debt crisis in recent months.
Prices remained supported after the Wall Street Journal reported that a growing number of Federal Reserve officials have concluded that the central bank needs to expand its stimulus program in order to boost growth and increase job hiring.
There are also expectations in the market that China will cut its banks’ reserve requirement ratio to boost lending and support growth in the world’s largest copper consumer.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for August delivery shed 0.3% to trade at USD1,603.45 a troy ounce, while silver for September delivery fell 0.75% to trade at USD27.25 a troy ounce.
