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METALS-London metals slip after Fed raises rate hike expectations
September 21, 2017 / 2:48 AM / a month ago

METALS-London metals slip after Fed raises rate hike expectations

MELBOURNE, Sept 21 (Reuters) - London metals came under pressure on Thursday after the Federal Reserved raised expectations of one more rate hike this year, lifting the dollar and raising prospects of higher costs for industrial metals.

FUNDAMENTALS

* LME COPPER: London Metal Exchange copper had slipped by 0.8 percent to $6,471 a tonne by 0150 GMT, following a slightly softer close in the previous session. Prices earlier fell to $6,462 a tonne, the weakest since Sept. 15.

* SHFE COPPER: Shanghai Futures Exchange copper also slid 0.8 percent to 50,360 yuan ($7,634) a tonne.

* FED: The U.S. Federal Reserve left interest rates unchanged on Wednesday but signalled it still expects one more increase by the end of the year despite a recent bout of low inflation.

* LME ALUMINIUM: LME aluminium eased from five-year highs tipped the session before but expectations of tighter supply into early next year underpinned prices.

* SHFE ALUMINIUM: Shfe aluminium rallied 1.6 percent as China’s aluminium makers begin to ramp down production ahead of mandated capacity closures during the winter heating season. Shfe aluminium is trading at six-year highs, above 17,000 yuan a tonne, and open interest is at record levels of above 1 million lots.

* CHINA PRODUCTION: Production cuts are already feeding through into lower output from the world’s top producer of the metal after Beijing’s campaign to close illegally built capacity earlier this year. Total Chinese production in August was 2.64 million tonnes, compared with 2.686 million tonnes in July, the International Aluminium Institute said.

* US ECONOMY: U.S. home resales fell to their lowest in a year in August as Hurricane Harvey depressed activity in Houston and a persistent shortage of properties on the market sidelined buyers.

* ZINC: Volcan Investments, the family trust of the chairman of diversified miner Vedanta, on Wednesday said it was increasing its stake in Anglo American but did not intend to make a bid for the entire company.

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MARKETS NEWS

* The U.S. dollar shone while Asian shares slipped slightly on Thursday after the U.S. Federal Reserve announced a plan to start shrinking its balance sheet and signalled one more rate hike later this year.

DATA AHEAD (GMT)

1230 U.S. Weekly jobless claims

1230 U.S. Philly Fed business index Sep

1300 U.S. Monthly home price index Jul

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.5972 Chinese yuan)

Reporting by Melanie Burton; Editing by Subhranshu Sahu

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