Most base metals fall on dollar strength, recession risks

BEIJING, Sept 7 (Reuters): Most base metals prices lost ground on Wednesday as the U.S. dollar strengthened further amid worries about a recession in major economies.

Three-month copper contract on the London Metal Exchange CMCU3 dropped 1.3% to 7,581 a tonne by 0535 GMT, while the most traded October copper contract on the Shanghai Futures Exchange SCFcv1 fell 0.5% to 60,660 yuan ($8,699.77) a tonne.

U.S. dollar/Chinese yuan fx spot rate CNY= climbed to a two-year high at 6.9740. This was despite China's central bank saying on Monday it would cut the amount of foreign exchange reserves, a move seen to help limit yuan weakness.

The greenback will remain strong over the remainder of this year and into the next as U.S. interest rates rise and the economy outperforms its peers, reinforced by its safe-haven appeal when investors choose to worry, according to a Reuters poll.

A strong dollar means it is more expensive for non-dollar buyers to buy the commodity.