Reuters reported that London copper slipped on sluggish post holiday purchases from top consumer China but prices were supported by hopes that Greece's bailout deal would succeed and help the euro zone avoid an economic downturn.
Three month copper on the London Metal Exchange fell 0.48% to USD 8,459 per tonne by 0702 GMT clawing back some losses from the previous session when it slipped by almost 1%. Copper hit a one week high of USD 8,598.50 and rose for the fourth consecutive week last week. The most traded April copper contract on the Shanghai Futures Exchange edged down 0.83% to CNY 60,030 per tonne.
US based analyst Ed Meir of INTL-FC Stone said that "It's all Greek related right now, there's nothing fundamentally to move the markets in terms of Chinese demand. Markets will discount some sort of agreement and the firmer tone will probably carry on until we have the next big shoe drop the Chinese trade data for January could be significant."
Greek leaders face crunch talks to agree on unpopular reforms to secure EUR 130 billion bailout and avert a chaotic debt default which could threaten its future in the euro zone.
The leaders are caught between their increasingly frustrated partners in the European Union for failing to pass the reforms quickly and workers who went on strike on Tuesday to protest against the austerity measures.
The euro was edging lower against the dollar ahead of the talks, adding headwinds to metals because a stronger greenback raises the cost of commodities for holders of other currencies.
On the demand side, Chinese trade data is due later this week, with markets keeping a close eye on copper imports which hit a record high in December when arbitrage and financing opportunities burnished the metal's appeal.
China is the world's largest copper consumer, and monthly import figures have been climbing since June 2011. But imports are expected to be weaker in January in part due to Lunar New Year holidays and as slower manufacturing weakened demand. How much weaker will be a key point watched by the market, given signs of sluggish post holiday consumption.
(Sourced from Reuters)
