Copper Set for Biggest Weekly Loss in Months on Oil-Driven Inflation, Growth Fears
March 20 (Reuters) - Copper is set to post its steepest weekly loss in months, despite a pullback on Friday, as the Middle East war fuels fears of higher inflation and a hit to global growth amid surging oil prices.
The benchmark three-month copper CMCU3 on the London Metal Exchange gained 1.23% to $12,296 a metric ton as of 0331 GMT. It is set to post a near 4% weekly loss, the biggest since April last year.
The most active copper contract SCFcv1 on the Shanghai Futures Exchange was unchanged at 95,850 yuan ($13,903.39) a ton, and is poised to drop 5% this week, the biggest weekly drop since early February.
Central banks held rates this week and warned that the war-driven jump in oil prices could rekindle inflation and weigh on growth.
It prompted investors to push back on rate-cut bets and, in some cases, revive expectations of renewed tightening.
Brent futures LCOc1 eased on Friday but were still above $105 a barre, gaining more than 47% so far since the war started on February 28.
The conflict is fuelling concerns over the possibility of a recession triggered by stagflation and rate hikes, leading to copper's break below key support level, Chinese broker Galaxy Futures said.
Aluminium also felt the pinch, giving back some of its gains. The Gulf accounts for 8% of the world's output.
Shanghai's most-active aluminium contract SAFcv1 declined 0.73% to 24,370 yuan a ton, and is set to end the week nearly 3% lower.
London benchmark aluminium CMAL3 gained 1.29% to $3,294 a ton, set to gain more than 4% for the week.
Aluminium Bahrain ALBH.BH said on Thursday that it is exporting metal via the Saudi port of Jeddah after the Strait of Hormuz remained effectively shut.
Elsewhere on SHFE, zinc SZNcv1 gained 0.72%, lead SPBcv1 dropped 1.03%, nickel SNIcv1 gained 1.50% and tin SSNcv1 nudged 0.04% higher.
Among other LME metals, zinc CMZN3 gained 1.24%, lead CMPB3 nudged 0.08% higher, nickel CMNI3 climbed 0.93% and tin CMSN3 surged 2.42%.
