Copper futures came under heavy selling pressure during European morning hours on Monday, falling to the lowest level since November as worries over a controversial bailout deal for Cyprus weighed on appetite for riskier assets.
Copper prices also struggled for upside traction due to a stronger U.S. dollar, as dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.6% to trade at 82.89.
On the Comex division of the New York Mercantile Exchange, copper futures for May delivery traded at USD3.443 a pound during European morning trade, down 2.2% on the day.
New York-traded copper prices fell by as much as 2.9% earlier in the day to hit a session low of USD3.419 a pound, the weakest level since November 9.
On Saturday, the European Union and International Monetary Fund reached an agreement on a EUR10 billion bailout for Cyprus. In exchange for the rescue money, international creditors would impose a one-time tax of 6.75% on all bank deposits under EUR100,000 and 9.9% over that amount.
The agreement marked the first time since the onset of the debt crisis that depositors have been forced to take a haircut in return for financial aid and triggered a run on cash machines in Cyprus over the weekend, raising worries it could also spark an exodus of capital from fragile European economies.
The parliament in Cyprus was to vote on whether to approve the tax proposal later in the day. If the vote was defeated media outlets in Cyprus said banks could remain closed on Tuesday, following a public holiday on Monday, to avoid mass withdrawals.
The news prompted investors to shun riskier assets, such as stocks and industrial commodities, and flock to traditional safe haven assets like the U.S. dollar and Treasuries.
Concerns over a possible slowdown in China amid renewed government efforts to curb soaring property prices also weighed on the industrial metal.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for April delivery rose 0.6% to trade at USD1,602.40 a troy ounce, while silver for May delivery dipped 0.15% to trade at USD28.80 a troy ounce. Source:Investing.com
Copper prices also struggled for upside traction due to a stronger U.S. dollar, as dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.6% to trade at 82.89.
On the Comex division of the New York Mercantile Exchange, copper futures for May delivery traded at USD3.443 a pound during European morning trade, down 2.2% on the day.
New York-traded copper prices fell by as much as 2.9% earlier in the day to hit a session low of USD3.419 a pound, the weakest level since November 9.
On Saturday, the European Union and International Monetary Fund reached an agreement on a EUR10 billion bailout for Cyprus. In exchange for the rescue money, international creditors would impose a one-time tax of 6.75% on all bank deposits under EUR100,000 and 9.9% over that amount.
The agreement marked the first time since the onset of the debt crisis that depositors have been forced to take a haircut in return for financial aid and triggered a run on cash machines in Cyprus over the weekend, raising worries it could also spark an exodus of capital from fragile European economies.
The parliament in Cyprus was to vote on whether to approve the tax proposal later in the day. If the vote was defeated media outlets in Cyprus said banks could remain closed on Tuesday, following a public holiday on Monday, to avoid mass withdrawals.
The news prompted investors to shun riskier assets, such as stocks and industrial commodities, and flock to traditional safe haven assets like the U.S. dollar and Treasuries.
Concerns over a possible slowdown in China amid renewed government efforts to curb soaring property prices also weighed on the industrial metal.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for April delivery rose 0.6% to trade at USD1,602.40 a troy ounce, while silver for May delivery dipped 0.15% to trade at USD28.80 a troy ounce. Source:Investing.com
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