June 13, 2018 / 5:53 AM / 4 months ago

METALS-Base metal prices fall ahead of Fed rate decision

 (Adds Shanghai closing prices, updates London prices)
    BEIJING, June 13 (Reuters) - Base metals prices fell on
Wednesday, led by Shanghai aluminium, which closed at a near
six-week low, as investors fretted over liquidity in China and
awaited news from the U.S. Federal Reserve's policy meeting.
    The Fed is expected to raise interest rates at its meeting.
Higher rates usually cause the dollar to strengthen, which would
make dollar-denominated metals more expensive for holders of
other currencies and could weigh on prices.
    Helen Lau, an analyst at Argonaut Securities in Hong Kong,
said Shanghai metals prices dropped because of a
lower-than-expected social financing figure in China amid an
intensified crackdown on the country's shadow banking sector.
    "Markets are worried about whether there would be
liquidity," Lau said.
    China's total social financing (TSF), a broad measure of
credit and liquidity in the economy, dropped sharply to 760.8
billion yuan ($118.80 billion) in May from 1.56 trillion yuan in
April, central bank data showed on Tuesday.   
        
    FUNDAMENTALS
    * SHFE ALUMINIUM: The most-traded August aluminium contract
on the Shanghai Futures Exchange ended 1.5 percent down
at 14,670 yuan ($2,290.79) a tonne, its lowest close since May
3.
    * COPPER: Three-month copper on the London Metal Exchange
 was down 0.5 percent at $7,186 a tonne, as of 0731 GMT,
trading lower for a fourth straight session, while Shanghai
copper closed down 0.8 percent at 53,530 yuan a tonne.
    * OTHER METALS: Shanghai zinc closed down 0.7
percent, while nickel ended 0.5 percent lower and lead
 finished down 0.2 percent. Only London lead
bucked the trend, edging up 0.2 percent.
    * GLENCORE: Democratic Republic of Congo state miner
Gécamines will drop legal proceedings to dissolve a copper and
cobalt joint venture with a subsidiary of Glencore Plc
after reaching a settlement with its partner that includes
Gécamines getting a $150 million payment.
    * PERU: Southern Copper Corp said on
Tuesday that it plans to start building its proposed $2.5
billion copper mine Michiquillay in Peru next year and will
likely start operations in 2022 - three years earlier than
previously forecast.
    * For the top stories in metals and other news, click       
 or     
        
    MARKETS NEWS    
    * Asian shares slipped back on Wednesday as investors looked
to the Federal Reserve policy decision later in the day and any
clues it might give on future rate hikes, shifting focus away
from the historic U.S.-North Korea summit in Singapore.
    
        
    
    PRICES  
 BASE METALS PRICES                       0734 GMT
 Three month LME copper                     7178.5
 Most active ShFE copper                     53530
 Three month LME aluminium                    2279
 Most active ShFE aluminium                  14670
 Three month LME zinc                         3184
 Most active ShFE zinc                       24260
 Three month LME lead                         2476
 Most active ShFE lead                       20500
 Three month LME nickel                      15195
 Most active ShFE nickel                    114710
 Three month LME tin                         20790
 Most active ShFE tin                       147460
                                                  
 BASE METALS ARBITRAGE                            
 LME/SHFE COPPER             LMESHFCUc3     -43.08
 LME/SHFE ALUMINIUM          LMESHFALc3   -2302.87
 LME/SHFE ZINC               LMESHFZNc3      72.66
 LME/SHFE LEAD               LMESHFPBc3     688.69
 LME/SHFE NICKEL             LMESHFNIc3    -442.26
 ($1 = 6.4039 Chinese yuan)

    
 (Reporting by Tom Daly; Editing by Biju Dwarakanath and Sherry
Jacob-Phillips)
  
 
 
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