Aug 20 (Reuters) - London copper fell on Thursday following a sell-off in equities and risky assets after the U.S. Federal Reserve expressed worries about an uncertain economic recovery, although some traders expect the weakness to be short-lived.
Three-month copper on the London Metal Exchange declined 1.3% to $6,587 a tonne by 0705 GMT. The contract hit its highest since June 2018 at $6,707 a tonne on Wednesday.
“It’s because of the equities’ sell-off triggered by a less optimistic outlook by the Fed. Metals should resume their uptrend soon. This sell-off is not deep at all,” said a Singapore-based metals trader.
“There will be continuous dollar devaluation. More hot money will be piling into risky assets,” the trader said.
Several Fed policymakers say the U.S. central bank may need to ease monetary policy further to help nurse the economy through the coronavirus outbreak, minutes from their policy meeting last month showed on Wednesday.
Copper is often viewed as a gauge of the global economic health.
The most-traded September copper contract on the Shanghai Futures Exchange closed up 0.1% to 51,980 yuan ($7,509.72) a tonne, tracking overnight gains in London.
* LME nickel dropped 0.3% to $14,675 a tonne, lead fell 1.2% to $1,988 a tonne and in Shanghai, nickel declined 0.5% to 116,130 yuan a tonne while aluminium advanced 0.8% to 14,675 yuan a tonne.
* China kept its benchmark lending rate for corporate and household loans steady as expected for the fourth straight month at its August fixing.
* Australia-based copper miner MMG Ltd said its half-yearly loss nearly doubled, while Australian miner South32 Ltd reported an 80.5% slump in full-year underlying profit.
* Chinese state-backed metal research house Antaike said it had advised Beijing to stockpile cobalt but the timing of any state plans to purchase the metal was uncertain.
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$1 = 6.9217 yuan Reporting by Mai Nguyen; Editing by Aditya Soni, Rashmi Aich and Uttaresh.V
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