(Reuters) Prices for London’s aluminium fell to their lowest levels since more than an 18-month period on Monday because of fears of a weakening of market demand as well as a tighter dollar had a negative impact in the marketplace.
Three-month supply of aluminium traded on the London Metal Exchange fell as up to 1.2 percent to $2139 a tonnes, its lowest level in the last month since march 2021. The contract is down almost half of the record price of $4,073.50 which was set just six months ago on the 7th of March.
The most-traded aluminum contract for October at the Shanghai Futures Exchange fell to the lowest level since Sept. 2 at 18,055 Yuan ($2,524.47) 1 ton.
Related: Prices for aluminium and copper skyrocket as a result of the Ukraine news.
The metal’s prices during the course of this year were buoyed by fears of supply disruptions from the largest producer Russia following the fact that Moscow launched an attack against Ukraine and was further aggravated by the closing of several smelters across Europe because of the escalating prices for power.
However, with central banks increasing their rates and the world’s economic outlook fell and the dollar reached an all-time high of two decades, affecting the demand for precious metals priced in greenbacks in the LME.
“High prices for electricity and high interest rates have the potential to impede the production of industrial equipment and impact the consumption of aluminium. This has led to a decline in stocks and a decline in prices across the major areas,” said Citi analysts in an announcement.
“Looking in the future, aluminium end-of-life consumption is likely to be impacted in the coming two quarters as Europe moves towards recession… The announcements of more closures could cause prices to rise, but we believe that any such rally are not sustainable,” they added.
Related: Tesla raises prices across the board in the United States.
LME copper dropped to its lowest level since July 21st of $7,292.50 per tonne. Zinc decreased 0.9 percent to $2,982.50 per tonne by 0728 GMT The price of lead climbed 0.7 percent to $1,816.50 one tonne and Tin climbed 1.6 percent to $20,600 ton.
ShFE nickel fell 3.7 percent to 187,500 Yuan one tonne. Tin dropped 2.8 percent to 179,090 yuan one tonne. Aluminum fell 3.5 percent to 18,075 yuan per tonne, and zinc fell 2.8 percent to 24,280 yuan per tonnes.
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($1 = 7.1520 yuan)