HANOI, May 14 (Reuters) - Copper prices fell on Friday and were on track for their first weekly decline in more than a month, as worries of tightening credit that could potential cap demand of the metal.
Three-month copper on the London Metal Exchange dipped 1.8% to $10,161 a tonne by 0605 GMT, down 2.5% on a weekly basis, its first decline since the week ended April 2.
The most-traded June copper contract on the Shanghai Futures Exchange dropped 3.2% to 73,600 yuan ($11,431.41) a tonne, also set for a weekly decline.
“Supply will improve, while we note credit impulse data in the United States and China is easing, which will help demand taper off later this year and next,” said Fitch Solutions in a report.
“Metal prices will ease later in the year as the ongoing supply-demand mismatch eases.”
China’s new bank loans fell more than expected in April while money supply growth slowed to a 21-month low, as the central bank gradually scales back pandemic-driven stimulus to reduce debt and financial risks in hot areas of the economy.
Earlier this week, China’s state council said the country, the world’s biggest metals consumer, will monitor changes in overseas and domestic markets and effectively cope with a fast increase in commodity prices, without specifying how.
Both copper contracts hit their record high on Monday.
FUNDAMENTALS
* LME aluminium fell 1.6% to $2,412 a tonne, nickel was down 1.3% to $17,095 a tonne and zinc advanced 0.8% to $2,896 a tonne.
* In Shanghai, aluminium fell 3.5% to 19,040 yuan a tonne, nickel dropped 3.1% to 126,440 yuan a tonne while lead declined 2.2% to 15,065 yuan a tonne.
* Russian metals producer Nornickel has resumed full operations at its nickel-copper Oktyabrsky mine hit by flooding this year.
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$1 = 6.4384 yuan
Reporting by Mai Nguyen; Editing by Rashmi Aich
Source: Reuters