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"Quote - Base Metals" by Mr. Saish Sandeep Sawant Dessai, Research Associate- Base Metals, Angel One Ltd

Following a good run in the previous several weeks, the base metals pack is expected to see its first weekly fall in over three weeks, with Zinc and Aluminium ending lower by about 2% on the LME and MCX, respectively.

Copper prices on the LME, on the other hand, fell for the first time in four weeks, as the strength of the dollar played a key role in making the greenback-priced metal more expensive for holders of other currencies. The dollar index increased by roughly 1%. The dollar's gain was spurred by risk aversion, which was triggered by hawkish comments from global central banks, notably the US Federal Reserve, who expressed fear that rapid monetary tightening would lead to a worse economic downturn.

The fall in available copper stockpiles in London Metal Exchange (LME) certified warehouses also contributed to price fluctuation. Large cancellations of warrants, which indicate an intention to take delivery of metal, exacerbated concerns about LME supply. The stronger dollar offset support from reduced copper stocks, causing a decline in copper prices.

Aluminium and Nickel also experienced significant decreases, the largest since last month. The lack of significant support from China, the world's largest metals consumer, weighed on base metals’ prices even further. China's economy has been slow to recover from the COVID-19 lockdown, confounding market expectations.

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