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Copper edges higher after Chile cuts supply forecast

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Investing.com -

Investing.com - Copper prices edged higher in choppy trade on Wednesday, as concerns over a disruption to supplies continued to support prices.

On the Comex division of the New York Mercantile Exchange, copper for May delivery tacked on 0.3 cents, or 0.09%, to trade at $2.766 a pound during European morning hours.

A day earlier, copper rose 4.6 cents, or 1.69%, to settle at $2.763. Futures were likely to find support at $2.693, the low from April 6, and resistance at $2.831, the high from April 6.

Chilean state copper commission Cochilco said on Tuesday that the country is expected to produce 5.94 million tons of copper in 2015, down from a previous estimate of 6.0 million tons.

Chile produces around a third of the world's copper and is the world's biggest exporter of the metal.

Futures have been well-supported in recent months as a disruption to mining output in Chile, Indonesia and Australia prompted traders to reassess the outlook for global supply and demand.

Before the recent wave of disruptions, many market analysts anticipated that copper production from mines would exceed demand in 2015 for the first time in six years. Now, some are predicting a deficit.

Prices of the red metal are up almost 14% since hitting a recent low of $2.420 on January 26.

Elsewhere on the Comex, gold futures for June delivery shed $1.40, or 0.12%, to trade at $1,209.20 a troy ounce, while silver futures for May delivery dipped 0.7 cents, or 0.04% to trade at $16.83 an ounce.

The U.S. dollar index, which measures the greenback's strength against a trade-weighted basket of six major currencies, was down 0.55% to trade at 97.71 early on Wednesday.

Investors will be focusing on Wednesday's minutes of the latest Federal Reserve meeting for further indications on the central bank's next policy moves after Friday's downbeat jobs data fuelled uncertainty over the timing of a rate hike.

The Labor Department reported Friday that the U.S. economy added 126,000 new jobs in March, less than half of February's gain and the smallest increase since December 2013.

Gold prices are up nearly 6% since hitting a recent low of $1,140.60 on March 17, as indications that the U.S. economy slowed in the first quarter fuelled bets the Fed will hold off on hiking interest rates until late 2015.

A delay in raising interest rates would be seen as bullish for gold, as it decreases the relative cost of holding on to the metal, which doesn't offer investors any similar guaranteed payout.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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