|Reuters reported that Shanghai copper fell 1% after Beijing's latest tightening move but a weaker dollar following Ireland's rescue deal helped London prices stay firm.|
China on Friday raised cash reserve requirement for banks the second such move in a fortnight, stepping up its battle to tame inflation.
Mr Lin Yuhui, deputy general manager of Jinhui Futures said that "In the short term there is no clear direction in the market. Investors are wary of more tightening moves, but a weaker dollar is providing support. The market needs some time to digest the bearish sentiment from China's expected tightening moves but industrial metals are unlikely to fall much."
Three month copper on the London Metal Exchange gained half a percent to USD 8,448.50 per tonne by 0701 GMT after posting its sharpest weekly loss in the previous week. Shanghai's most active third month copper SCFc3 fell 1% to CNY 63,310 per tonne.
Mr Li Ye an analyst at Star Futures based in China said that the government just wanted to reign in the pace of economic growth which means that the economy will still grow strong but not as fast, boding well for copper demand.
The European Union and International Monetary Fund agreed on Sunday to help bail out Ireland with loans to tackle its banking and budget crisis in a bid to protect Europe's financial stability.
Mr Wang Tao a Reuter’s market analyst said that the euro rose broadly while the dollar fell more than half a percent against a basket of currencies. A bullish target at USD 8,649.25 per tonne for LME copper is unchanged as a bull trend has been established.