THE London copper prospects edged higher on Monday, bouncing back from losses in the previous session amid a softer dollar, but a shaky demand outlook for the world's top copper consumer China capped gains.
Three-month copper on the London Metal Exchange (LME) rose to 0.6 per cent to US$8,089 a tonne by 0703 GMT, after falling by as much as one per cent last week..
According to Reuters, copper prices last week, rallied to near one week high hit the session just before China's export demand improved in December, while dollar weaknesses also helped after the European Central Bank gave no indication of further rate cuts.
A weaker dollar makes commodities priced in the greenback cheaper for holders of other currencies such as the Euro.
Barclays Capital Commodities analyst Sijin Cheng said despite the gain, weaker Chinese demand and an expected increase in global copper supply this year would keep prices trading in a tight range.
Barclays expects global copper supply to outpace demand by 151,000 tonnes this year, compared with a 49,000-tonne surplus in 2012.
Expectations that China's economy may see a modest rebound instead of brisk growth are also likely to cap any gains in copper, which should trade between $7,000 and $8,500 this year, she said.
Meanwhile, the Kwacha has continued to lose ground against the greenback and is expected to be under pressure as the continued dearth in supply will leave the Kwacha with very little support against a relatively strong demand.
According to Zanaco daily newsletter, the local unit traded pretty flat around KR5.260/5.280 during much of the day's session on Friday but eventually closed trading 10 Ngwee weaker at KR5.270/5.290 on the bid and offer respectively.
The report said interbank trading on Friday was characterised by thin trading with minimal activity seen on the corporate front.
Intraday, the Kwacha continued to lose ground against the greenback and saw the local unit opened Friday's trading unchanged from Thursday's closing level of KR5.260/5.280.