Aluminum hits 5-week low on rising inventories

By Pratima Desai

LONDON, Feb 13 (Reuters) – Aluminum prices fell to their lowest level in five weeks on Monday as stocks in London Metal Exchange (LME) licensed warehouses fell, while copper profited from the rise prices. loans.

Aluminum prices (LME) fell 1% to $2,416 a tonne from $2,410 previously, the lowest level since Jan. 10. Copper rose slightly to $8,859 a tonne.

“Rising inventories led to selling in the aluminum market and some positive data from China is helping copper,” a metals trader said.

Traders signaled that trading ahead of Wednesday’s settlement could lead to volatility across all LME metals.

LME aluminum inventories, at 576,775 tonnes, have nearly doubled since February 6, easing fears of shortages and supply in the LME market.

Aluminum inventories in warehouses supervised by the Shanghai Futures Exchange of 268,984 tonnes have risen nearly 180% since late December, which analysts said reflects weak demand in China, the main consumer.

However, traders said the surge in new bank loans in China hit a record 4.9 trillion yuan ($720.21 billion) last month, suggesting the country’s central bank is trying to boost the economy. growth after COVID controls are lifted.

“It’s positive, but it will take time to catch on,” said a commodity fund trader. “In the meantime, the macroeconomic elements continue to be very present.”

Macro elements refer to the US Federal Reserve and its interest rate decisions, which help determine the direction of the dollar. Clues on Federal Reserve policy will come from U.S. consumer price data on Tuesday.

A higher US currency tends to make dollar-denominated metals more expensive for holders of other currencies, which could dampen demand for industrial metals. (XRF/)

Meanwhile, increased zinc inventories in LME warehouses eased concerns about LME availability. This can be seen in the shrinking cash bonus on the three-month contract.

Three-month zinc fell 1.1% to $3,009 a tonne.

In other metals, lead rose 0.8% to $2,095 a tonne, tin added 0.1% to $27,375 and nickel fell 3.6% to $26,790.

(Reporting by Pratima Desai; Editing in Spanish by Juana Casas)