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Informist, Thursday, Sept. 4, 2025

By J. Navya Sruthi

MUMBAI – Futures contracts of most base metals were down on the Multi Commodity Exchange of India Thursday tracking those on the London Metal Exchange due to a firm dollar index. However, rising hope for an interest rate cut by the US Federal Reserve later this month is likely to restrict the downside in prices of these metals. 

At 1857 IST, the dollar index, which measures the strength of the greenback against a basket of six currencies, was up nearly 0.2% from the previous close at 98.315. A stronger dollar makes dollar-denominated commodities such as base metals expensive for those holding other currencies, thereby reducing demand for the metal.

COPPER futures fell on the MCX, tracking those on LME, "as a stronger dollar and profit-taking weighed on sentiment", Kotak Securities said in a report. Also, soft industrial activity in China weighed on copper prices, Dow Jones quoted ANZ Research team as saying in a note. 

China's official manufacturing purchasing managers' index rose to 49.4 in August from 49.3 in July, remaining in contraction territory, and missing market expectations. A reading below 50 indicates contraction in the sector and a number above 50 signals expansion. Further, rising LME inventories, up nearly 75% since June, highlighted softer demand, weighing on prices, Kotak Securities said.

However, expectations of an interest rate cut by the US Federal Reserve later this month are likely to support prices of base metals. The US job openings fell to 7.18 million from 7.36 million Wednesday, boosting hope of a rate-cut by the US Federal Reserve. According to the CME FedWatch tool, traders see a 97.4% probability of a 25-basis-point rate cut by the Federal Reserve in its September meeting, higher than the 86.7% last week. Lower rates reduce borrowing costs, which leads to higher economic growth and increases demand for base metals such as copper.

ALUMINIUM inventories at Shanghai Futures Exchange-monitored warehouses rose by 991 tonnes on week to 125,596 tonnes in the week ended Friday. ZINC stocks surged by 5,166 tonnes to 85,980 tonnes. LEAD stocks rose by 982 tonnes to 64,672 tonnes in the week ended Friday.

At 1913 IST, on the MCX, the September futures contract of:
-–Aluminium was at INR 254.6 a kg, down 0.2%
–-Copper was at INR 901.65 a kg, down 0.5%

–-Lead was at INR 181.90 a kg, up 0.1%
–-Zinc was at INR 273.75 a kg, down 0.6%

--NICKEL was at INR 1,337.00 a kg, down 0.9%

Trading levels for the day on the MCX:
--Aluminium contract seen at INR 252.00-INR 258.50
--Copper contract seen at INR 897.00-INR 912.00
--Lead contract seen at INR 180.20-INR 183.80
--Zinc contract seen at INR 271.00-INR 278.50

--Nickel contract seen at INR 1,323.00-INR 1,382.00

End

US$1 = INR 88.14

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Deepshikha Bhardwaj

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