LONDON, Jan 21 (Reuters): Copper prices dipped on Wednesday, under pressure from the uncertain outlook for demand from top consumer China, with investors also eyeing the outcome of this week's European Central Bank policy meeting for signs of stimulus measures.
Three-month copper on the London Metal Exchange (LME) was down 1 per cent at $5,631 a tonne at 1036 GMT, with trading volumes down to a third of typical levels.
Prices have rebounded from the 5-1/2 year low of $5,353.25 a tonne hit last week, but are still 10 per cent lower in the year to date.
The ECB is widely expected to unveil a sovereign bond-buying programme at a policy meeting on Thursday in a bid to ward off deflation and kick-start growth.
"The ECB's upcoming decision could inflate the demand for copper if they are successful in igniting growth in the euro zone," said Naeem Aslam, chief market analyst at Ava Trade.
"The euro zone needs to spend on infrastructure to boost growth and if the ECB can restore confidence in the area, this.. will kickstart many construction projects which is a positive sign for the metal's demand."
The European economy is "on the brink of deflating" and urgently needs more stimulus, particularly from the continent's largest economy Germany, former U.S Treasury secretary Larry Summers said.
Analysts have also been assessing a deluge of Chinese economic growth data this week, which has dampened demand prospects for copper, a UBS analyst said.
Copper edges lower, ECB policy meeting in focus
FE Team | Published: January 22, 2015 00:00:00 | Updated: November 30, 2026 06:01:00
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