Copper futures for September delivery plunged 1.33% to $3.49 per pound this afternoon, while the dollar index soared after the release of strong US data and prospects for further QE from the Fed diminished.
Getty Images US employment figures surprised on the upside, decreasing the probability for further QE, which in turn led to a dollar rally. It will now cost more in dollars to buy the same amount of copper. As a result, the metal gave up gains made in the past few days.
The industrial metal reached a high of $3.54 earlier this morning as China unexpectedly cut their lending rate by 31 bps and the deposit rate by 25 bps, while the ECB reduced its refinancing rate to 0.75% from 1% previously.