Copper prices continued their descent Wednesday to their lowest in nearly 20 months on persistent worries that a recession would hurt demand for metals as well as the dollar's nearly 20-year high vs. the euro.
According to Reuters, three-month copper on the London Metal Exchange fell as much as 4.9% to $7,291.50/metric ton, the lowest since November 2020, before paring losses.
ETFs: ( NYSEARCA: COPX ), ( NYSEARCA: CPER ), ( JJC ), ( JJCTF )
The major metals miners, which all fell sharply yesterday, show mostly small pre-market losses, including ( NYSE: FCX ), ( TECK ), ( RIO ), ( BHP ) and ( VALE ).
"Dollar strength yesterday was the trigger that came on top of the recent recession fears... the weakness overnight looks like it was driven by China and the COVID problems they're still facing," said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.
A fresh round of mass virus testing in Shanghai highlighted concerns that China's zero-COVID policy will weigh on any budding economic recovery.
China's fresh COVID-19 flare-ups also are weighing on iron ore futures , which hit YTD lows in Singapore ( SCO:COM ).
Iron ore's front-month August contract in Singapore fell as much as 5.4% to $106.45/ton, although the most-traded contract on the Dalian Commodity Exchange ( TIOC:COM ) ended daytime trading up 1.8% at 747 yuan/ton ($111.42) after swinging wildly between losses and gains.
Spooked by recession fears, copper prices plunged more than 20% in Q2, the metal's biggest quarterly decline since 2011 .
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Copper, iron ore slide continues as recession fears dominate sentiment