Copper in London traded near a 44-month low as China doubled the yuan’s trading limits versus the dollar.
The metal for delivery in three months was little changed at $6,466.75 a metric ton at 10:39 a.m. in Hong Kong after rising as much as 0.3 percent and falling as much as 0.4 percent. The contract closed at $6,415 on March 13, the lowest since July 2010.
The Chinese currency was permitted from today to trade as much as 2 percent on either side of the government’s reference rate, from 1 percent previously, the People’s Bank of China said in a March 15 statement. This may make the use of copper as collateral to get credit less attractive to investors in China, said Sijin Cheng, a commodities analyst at Barclays Plc in Singapore. Copper fell 4.6 percent last week on concern that the slowing Chinese economy would reduce demand for the metal.
“If CNY is no longer a one-way bet, it could be marginally or incrementally negative for copper financing,” Cheng said by phone. “I think people are still just a little bit jittery.”
In New York, the Comex copper futures contract for delivery in May was little changed at $2.9495 a pound, while in Shanghai the contract for June rose 0.7 percent to 44,580 yuan ($7,239) a ton.
On the LME, aluminum and zinc were little changed while tin, nickel and lead advanced.