London 26/08/2016 - Base metals ended the week mixed on the LME ahead of a long weekend - the exchange will be closed on Monday for a bank holiday in the UK.
The key event today was a speech from Federal Reserve chair Janet Yellen. At the Jackson Hole meeting, Yellen said the case for a rate increase has strengthened in recent months, which investors took as a hawkish signal.
The FOMC expects moderate growth in real gross domestic product (GDP), additional strengthening in the labour market and inflation to rise to two percent over the next few years.
Commodity markets initially collapsed but then staged a major recovery after the dollar index tumbled to a one-week low at 94.49 - despite Yellen's hawkish comments, prediction markets do not expect the Fed to move in September and are only assessing a 42-percent chance that the Fed raises rates at all this year, according to CME Group FedWatch.
The dollar index has since rebounded to a slightly higher 95.19.
In data today, EU M3 money supply undershot at 4.8 percent while private loans were as expected at 1.8 percent.
From the US, preliminary GDP growth was as expected at 1.1 percent. UoM consumer sentiment fell short at 89.8 while UoM inflation expectations were unchanged from the previous reading at 2.5 percent.
In the metals, copper concluded at $4,615 per tonne, down $11 on Thursday's close after more inventories arrived into LME sheds. Total stocks increased 7,700 tonnes to 271,575 tonnes - the highest since October 2015.
Today's increases were once again centred on Asia - the Busan total jumped 8,500 tonnes to 67,600 tonnes. Soft Chinese premiums have attracted large chunks of metal into Asia; more than 60,000 tonnes have been delivered in since the start of the week.
Aluminium edged $2 lower at $1,642.50 - while stocks dropped 7,425 tonnes to 2,246,350 tonnes, cancelled warrants climbed 9,925 tonnes to 926,700 tonnes after 14,450 tonnes were freshly cancelled in Vlissingen and 2,900 tonnes in Rotterdam.
Nickel at $9,800 was down $45; stocks fell 1,848 tonnes to 370,566 tonnes and cancelled warrants slipped 2,298 tonnes to 110,586 tonnes.
Zinc was last indicated at $2,314/2,315, up $16. It climbed to a high of $2,333 earlier - its strongest since May last year. Volumes were robust - more than 17,000 lots changed hands on Select, outpacing the rest of the complex.
The metal has found support from talk of deficits and nearby tightness in spreads. The benchmark cash/threes was last at a backwardation of $4.
Stocks and cancelled warrants both fell 900 tonnes to 454,175 tonnes and 25,250 tonnes respectively.
Still, there are ample tonnages of metal stored off warrant, in particular in New Orleans and Asia, and persistent tightness could prompt metal owners to deliver, market participants said.
Lead at $1,875 was up $13 after stocks and cancelled warrants both fell 75 tonnes to 187,225 tonnes and 67,775 tonnes respectively. Tin was last at $18,890, up $140, while stocks were unchanged.
Cobalt and molybdenum were last indicated at $25,750/26,250 and $16,000/16,500 respectively.
(Additional reporting by Kathleen Retourne, editing by Mark Shaw)