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London copper slips due to US tariff woes, soft dollar limits fall

London copper fell on Tuesday due to concerns about the U.S. trade war and tariff policy affecting demand. However, a weaker dollar cushioned the decline.

The price of three-month copper at the London Metal Exchange decreased by 0.4%, to $9.494.5 per metric ton as of 0155 GMT.

The Shanghai Futures Exchange's most active copper contract fell by 1.1%, to 77610 yuan (10,694.80 dollars) per ton.

Last week, the benchmark LME copper price reached a record high of $9 739 after U.S. president Donald Trump exempted automakers for a month from tariffs of 25% on Canada and Mexico.

Trump refused to comment Sunday on the negative reaction of the market to his on and off again tariff actions against major U.S. trading partner, or whether the anxieties relating to his erratic policies could push a softening U.S. economy into recession.

The longer-term effects of altered trade routes, and any retaliation against tariffs, could be economic shocks and uncertainty for investment, and eventually headwinds for suites. This is especially true if tensions between the U.S.A. and China continue to rise.

Here, you can see that the health of China has become more uncertain than it was during the previous tariff period.

China consumes around half of the global copper supply annually.

The yen, however, was the safe haven of choice for investors on Tuesday. It traded at near five-month-highs amid fears that a slowdown in U.S. economic growth could be due to tariffs. This has rattled U.S. stock markets and the dollar.

The greenback is less expensive to buyers of other currencies.

Other metals include LME aluminium, which fell by 0.7% to 2,674 per ton. Zinc also declined, falling 0.6% to 2,840, and nickel, which fell 0.8% to 16,425. Lead fell 0.6% to $2,037 while tin dropped 0.5% at $32,500.

SHFE aluminium fell 0.8%, to 20,700 Yuan per ton. Zinc lost 0.9%, to 23,640 Yuan. Lead gained 0.2% at 17,455 Yuan. Nickel fell 0.2% to 131 500 yuan, and tin dropped 0.3% to 261,940.

(source: Reuters)