Copper tumbles to near 20-month low as recession fears grip market

Copper prices sunk to their lowest in almost 20 months as persistent worries that a recession would dampen metals demand hit a market with thin summer volumes.

"That dollar strength yesterday was the trigger that came on top of the recent recession fears, pulling the rug from under the market," said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

"The weakness overnight looks like it was driven by China and the COVID problems they're still facing. And this is the time of year where the market can easily get caught on the wrong side when liquidity Liquidity Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Read this Term is drying up."