(Sept 28): Copper and other base metals retreated ahead of a weeklong holiday in China, as traders assessed the country’s demand outlook following slower growth in industrial profits.

Earnings at industrial enterprises rose just 4.2% in August from a year earlier, after increasing 11% in July, marking the weakest growth since the data showed a decline last November, according to the statistics bureau on Monday. China’s National Day holiday, meanwhile, runs from Oct 1 to 7.

Benchmark copper futures slipped as much as 1.6% on the London Metal Exchange, after capping a second weekly advance on Friday. The metal has rallied this year after bets the Trump administration will slap tariffs on refined metal triggered an increase in US imports, squeezing markets elsewhere.

While signs of supply tightness in the Chinese market have sustained copper not far from record levels, traders are closely monitoring macro drivers. Consumption and investment have softened, business confidence is sluggish and the government has kept the reins on fiscal spending.

In the US, investors largely expect a rate hike from the Federal Reserve in October, which would typically damp demand for industrial commodities.

Copper dropped 1.5% to US$14,397.50 a tonne on the LME as of 3.09pm in Singapore (same time as Malaysia) while zinc fell 1.5% and aluminium was 1.3% lower.

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