Copper prices are holding near eight-month highs on the back of easing global trade tensions and as top metals consumer China unveiled a measure to support flagging economic growth.
In holiday-thinned trade, benchmark copper on the London Metal Exchange closed barely changed at $US6,219 a tonne.
The metal widely used in power and construction was near its highest since May and was headed for its biggest monthly rise in two years.
“We have seen the market firm on risk appetite, with the trade war tension easing and some green shoots in China,” said Saxo Bank commodity strategist Ole Hansen.
China’s central bank will use the loan prime rate as a new benchmark for pricing existing floating-rate loans, in a step that analysts say could help lower borrowing costs and underpin economic growth.
The world’s second-largest economy has been hurt by a prolonged trade dispute that eased earlier this month when Washington and Beijing agreed to sign a phase one deal.
The White House’s trade adviser on Monday said the US-China phase one trade deal would likely be signed in the next week, but said confirmation would come from President Donald Trump or the US Trade Representative.
The South China Morning Post reported on Monday that Chinese Vice Premier Liu He will visit Washington this week to sign the phase one deal.
Ahead of the official signing, China approved two new genetically modified crops for import that could boost agricultural purchases from the United States, while renewing permits for 10 others, the agriculture ministry said.
A Reuters poll showed China’s factory activity likely expanded again in December on stronger external demand and an infrastructure push at home, but the pace of growth is set to ease as markets await more certainty on the trade truce.
Copper stocks in warehouses approved by the LME eased to 147,125 tonnes.
The US currency eased against a basket of major currencies. A weaker greenback makes dollar-denominated commodities cheaper for non-US firms, a relationship used by funds to generate buy and sell signals.
Norsk Hydro said it had resumed bauxite production in Brazil after a power outage earlier this month hit its Paragominas and Alunorte facilities, and was ramping up alumina output.
No negative customer impact was expected and the financial and operational impact has been limited, the company said.
Three-month aluminium on the LME snapped a six-session winning streak and fell from its highest since mid-September.
It closed almost unchanged from Friday, at $US1,826 per ounce.
Zinc was also flat at $US2,306 a tonne.
Lead added 0.2 per cent to $US1,942, tin slipped 0.7 per cent to $US17,000, and nickel rose 0.7 per cent to $US14,315.