METALS-Copper hits two-month low on oil surge, hawkish Fed
March 19 (Reuters) - Copper slid to its lowest in more than two months on Thursday, as oil prices spiked following Iranian attacks in the Middle East, stoking inflation fears and reinforcing a hawkish U.S. central bank outlook, while rising inventories added pressure.
The most-active copper contract SCFcv1 on the Shanghai Futures Exchange lost 3.24% to 95,680 yuan ($13,875.51) a metric ton as of 0315 GMT, after hitting the lowest since December 25 at 95,400 yuan.
And the benchmark three-month copper CMUC3 on the London Metal Exchange lost 0.96% to $12,275 a ton, after declining to $12,230, the lowest since December 30.
Copper's loss came amid traders assessed rising oil prices after Iran attacked energy facilities across the Middle East and the U.S. Federal Reserve's hawkish tone, a pressure that also weighed across the base metal complex.
Brent futures LCOc1 surged above $110 a barrel, following Iran's attack on several oil plants across Saudi Arabia, the United Arab Emirates and Qatar in retaliation for strikes on its own energy infrastructure in South Pars and Asaluyeh.
Rising oil prices fuel inflation concerns, bolstering expectations of tighter monetary policy and weighing on growth-linked metals such as copper.
Fed Chair Jerome Powell on Wednesday addressed rising energy prices, saying it would "push up overall inflation" but noted that "the scope and duration of the potential effects on the economy" was too soon to know in his speech after the U.S. central bank's widely-expected decision to keep interest rate unchanged.
Copper also came under pressure from mounting stock levels. Copper stocks in LME warehouses MCUSTX-TOTAL continued to rise after hitting the highest since 2019, totalling 334,100 tons as of Tuesday.
Elsewhere on SHFE, aluminium SAFcv1 declined 0.85%, zinc SZNcv1 lost 2.07%, lead SPBcv1 dropped 0.36%, nickel SNIcv1 tumbled 2.70% and tin SSNcv1 slid 3.82%.
Among other LME metals, aluminium CMAL3 dropped 0.38%, zinc CMZN3 lost 0.54%, lead CMPB3 was unchanged, nickel CMNI3 tumbled 1.96% and tin CMSN3 dipped 0.30%.
Thursday, March 19
DATA/EVENTS
0700 UK Claimant Count Unem Chng Feb
0700 UK ILO Unemployment Rate Jan
0700 UK HMRC Payrolls Change Feb
1200 UK BOE Bank Rate Mar
1230 US Initial Jobless Clm 14 Mar, w/e
1230 US Philly Fed Business Indx Mar
1315 EU ECB Refinancing Rate Mar
1315 EU ECB Deposit Rate Mar
1400 US New Home Sales-Units Jan
: : Japan JP BOJ rate Decision 19 Mar
($1 = 6.8956 Chinese yuan renminbi)
