Bloomberg News

Copper Advances in London on Possible China Easing: LME Preview

January 12, 2012

Jan. 12 (Bloomberg) -- Copper climbed in London on speculation cooling inflation in China, the world’s largest consumer, will allow the government to ease monetary policy to spur growth and demand.

Market News:

-- China’s inflation cooled to a 15-month low and producer-price gains were the smallest in 2 years in December, leaving the government more room to support growth as a global slowdown hurts exports. {NSN LXO36F0YHQ0X <GO>}

-- China’s auto sales slowed last year, trailing growth in the U.S. for the first time in at least 14 years, after the government ended stimulus measures and as the nation’s economic expansion showed signs of easing. {NSN LXO9Y16K50XV <GO>}

-- China has scope to loosen fiscal and monetary policy, making it better placed than India to weather a global economic slowdown, said Stephen Roach, non-executive chairman of Morgan Stanley Asia. {NSN LXNVXJ07SXKX <GO>}

-- India’s industrial production rebounded from the worst month since March 2009, a sign consumer demand is withstanding record interest-rate increases. Bonds fell and the stock index pared losses. {NSN LXO8QL0D9L35 <GO>}

-- Asia faces higher interest rates in the coming years as inadequate investment, tight labor markets, and a shift toward domestic demand boost inflationary pressure beyond the immediate growth slowdown, HSBC Holdings Plc said. {NSN LXO1BP0D9L35 <GO>}

-- Japan’s current-account surplus narrowed in November as a strong yen and weak overseas demand hampered the nation’s recovery from the March earthquake. {NSN LXNSP26K50XS <GO>}

-- Federal Reserve officials disagreed on the need for more easing amid signs of improvement in the economy that may shape the interest-rate forecasts they will reveal for the first time this month. {NSN LXNW7I1A74E9 <GO>}

Metals News:

-- Copper prices may gain as much as 25 percent in the second half of this year on steady demand from China, the world’s top consumer, amid tight supplies, according to Mizuho Corporate Bank Ltd. {NSN LXO56907SXKX <GO>}

-- Chinese aluminum smelters may idle their annual capacity by one-third, the most in three years, as energy costs soar and prices slump. {NSN LXN4SA6K50ZZ <GO>}

-- Vale SA, the world’s largest iron-ore producer, declared force majeure on iron-ore shipments and said it will lose 2 million metric tons of the steelmaking ingredient because of heavy rains in three Brazilian states. {NSN LXNR9Q0YHQ0X <GO>}

-- European steel mills may regain “pricing power” in the first quarter, with plants being used at 80 percent of capacity, UBS AG said. {NSN LXOBEJ07SXKX <GO>}

Metals Prices:

--Editors: Claudia Carpenter, John Deane

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@abloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter@bloomberg.net.


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