Copper set for weekly loss on strong dollar, macro headwinds

Copper fell on the London Metal Exchange on Friday and was on track to post a weekly loss as macroeconomic headwinds outweighed dip buying. Benchmark three-month copper on the LME fell 0.78% to $13,167 a metric ton by 0700 GMT. The most-traded copper contract on the Shanghai Futures Exchange was supported by bargain-buying, edging up 0.21% to 101,560 yuan ($14,930.24) a ton. The red metal was poised to end the week down more than 3% on the LME and just under 3% on the SHFE. Lower Shanghai copper prices brought some buying interest back to the market on Thursday, providing support, Chinese broker Jinrui Futures, a subsidiary of copper producer Jiangxi Copper, wrote in a note. The U.S. dollar surrendered gains earlier in the day to decline 0.01%. It nonetheless remains high, up 0.5% since the start of the week, weighing on greenback-denominated metal markets by making them more expensive for buyers using other currencies. Elsewhere, economic headwinds from the war in the Middle East helped push a key U.S. inflation indicator to its highest level in three years in May. Inflation and higher interest rate expectations have weighed on growth-dependent industrial minerals. Aluminium was largely stable, taking into stride jitters in this week's tentative Middle East peace after a cargo ship was hit by a projectile in the Strait of Hormuz. On the LME, it was flat, and on the SHFE, it edged up 0.11%. Prices for the light metal have fallen 7% on the LME since the start of the week as the Middle East risk premium receded. Among other LME metals, zinc lost 0.63%, lead dipped 0.24%, nickel dipped 0.17% and tin dipped 0.06%. Elsewhere on SHFE, zinc dipped 0.27%, lead added 0.31%, nickel lost 0.57% and tin gained 0.57%.