Forexpros – Copper futures remained lower during European morning trade on Thursday, after Spain saw borrowing costs rise at a government debt auction earlier in the day.
Market players were also awaiting monetary policy decisions from the European Central Bank and the Bank of England later in the day.
On the Comex division of the New York Mercantile Exchange, copper futures for September delivery traded at USD3.519 a pound during European morning trade, slumping 0.6%.
It earlier fell by as much as 1% to trade at a session low of USD3.494 a pound. Prices hit a seven-week high of USD3.556 a pound on July 3.
In Spain, the government sold at auction EUR2.997 billion of government bonds, in line with the full targeted amount of EUR3 billion, but at higher yields.
The country sold EUR747 million of ten-year debt at an average yield of 6.43% earlier in the day, up from 6.044% at a similar auction last month.
Meanwhile, the yield on Spanish 10-year bonds rose to 6.53% following the auction, re-approaching the critical 7%-level deemed as unsustainable in the long-term.
Investors were eyeing the outcome of the European Central Bank’s policy meeting later in the day.
The ECB was widely expected to announce an interest rate cut to 0.75% from the current record low 1.00% to help bolster growth in the region, following a recent string of weak economic data.
The ECB rate announcement was to be followed by a press conference with central bank head Mario Draghi to outline the reasons for the monetary policy decision and discuss the economic outlook for the euro area.
Meanwhile, the Bank of England was also set to update markets on its policy later in the day, amid hopes the central bank could increase the size of its government bond-buying program.
Market players were also eyeing Friday’s U.S. nonfarm payrolls report, amid speculation that the Federal Reserve could implement a third round of quantitative easing to shore up the economy, which has been hit by the ongoing crisis in the euro zone.
On Thursday, payroll processing firm ADP publishes its report on non-farm employment change, followed by government data on unemployment claims.
Copper traders were also hoping for further easing measures from Beijing to boost growth in China, the world’s second largest economy.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for August delivery eased down 0.3% to trade at USD1,617.05 a troy ounce, while silver for September delivery shed 0.35% to trade at USD28.18 a troy ounce.
Forexpros
