Copper prices fell on Thursday after comments from U.S. Federal Reserve officials raised fears of a sooner-than-expected interest rate hike in the world’s largest economy.

A rate hike could dampen liquidity into metals and slow a global economic recovery, eventually hurting demand for metals. Copper is also often used as a gauge of global economic health.

Three-month copper on the London Metal Exchange CMCU3 fell 1.2% to $9,370 a tonne by 0304 GMT, while the most-traded July copper contract on the Shanghai Futures Exchange SCFcv1 rose 0.6% to 68,520 yuan ($10,577.67) a tonne, tracking overnight gains in London.

A period of high inflation in the United States may last longer than anticipated, two U.S. Federal Reserve officials said on Wednesday, prompting one to pull forward his views on when the central bank should start raising interest rates.

FUNDAMENTALS

BHP Group BHP.AX plans to almost double exploration spending for base metals within five years, its Chief Technical Officer Laura Tyler said, after shifting its exploration headquarters to Canada.

LME aluminium CMAL3 fell 0.9% to $2,416.50 a tonne, nickel CMNI3 advanced 0.4% to $18,140 a tonne while ShFE nickel SNIcv1 jumped 2.1% to 135,770 yuan a tonne and ShFE tin SSNIcv1 increased 1.5% to 208,120 yuan a tonne.

TOP/MTL or MET/L MARKETS NEWS

Asian shares marked time, with China nudging lower, while the U.S. dollar held below an 11-week high as investors reassessed U.S. Federal Reserve statements on inflation and looked to upcoming data for direction.

MKTS/GLOB DATA/EVENTS (GMT)

0645 France Business Climate Mfg June

0800 Germany Ifo Business Climate New June

0800 Germany Ifo Curr Conditions New June

0800 Germany Ifo Expectations New June

1100 UK BOE Bank Rate June

1100 UK GB BOE QE Corp June

1230 US Durable Goods May

1230 US GDP Final Q1

1230 US Initial Jobless Claim Weekly
Source: Reuters (Reporting by Mai Nguyen; Editing by Amy Caren Daniel)