Base metals markets are experiencing a significant downturn, with copper leading the decline amid concerns over demand in China, the world’s largest consumer of commodities. The LMEX Index, which tracks six base metals, saw a 5.6% drop in London last week, marking the most severe weekly slump in nearly two years.
Despite China’s recent efforts to bolster its economy through surprise interest rate cuts and plans to strengthen local government finances, copper prices continued to fall for the sixth consecutive day. The metal, often considered an economic indicator, has retreated from its record high in May due to weak Chinese demand and increasing global inventories.
June saw an unprecedented surge in China’s refined copper exports, more than doubling previous figures and surpassing the record set in 2012. This unusual export increase has contributed to rising global stockpiles. London Metal Exchange warehouses reported inventory levels more than twice as high as two months ago, reaching peaks not seen since the height of the pandemic.
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