Copper Drops Half A Percent, Fed In Focus

Copper dropped today as the equities stayed mostly slippery ahead of a key interest rate decision from the US Federal Reserve. The Fed is expected to raise interest rates by 25 basis points at the end of its two-day policy meeting later today. The red metal has slipped from its four year highs on reports of progress in Escondida labor talks. The commodity is currently trading at $ 3.23 per pound, down 0.51% on the day. MCX Copper futures are currently trading at Rs 482.70 per kg, down 0.39% on the day.

Economic data was mixed yesterday. A report released by the US Labor Department showed another modest increase in consumer prices in the US in the month of May. The Labor Department said its consumer price index rose by 0.2% in May, matching the increase seen in April. German ZEW Indicator of Economic Sentiment for Germany fell 7.9 points in June, to stand at minus 16.1 points, its lowest level in over five-and-a-half years, survey data from the Centre for European Economic Research or ZEW showed Tuesday. This is the lowest reading since September 2012 and well below the long-term average of 23.3 points, ZEW said. The current conditions index of the survey dropped 6.8 points to a score of 80.6 points.

In other economic data, the UK unemployment rate remained unchanged at the lowest level since 1975, the Office for National Statistics reported. The ILO jobless rate remained at 4.2% in the three months ended April, but down from 4.6% a year ago. Australias business confidence index fell to 6.0 in May from 11.0 in the previous month, survey data from the National Australia Bank showed Tuesday. Similarly, business conditions dropped by 6 points to 15 in May from Aprils record high of 21.0.