Aug 18 (Reuters) - Base metals tracked global equities lower on Thursday on fears of further rate hikes in the United States that would trim economic growth and metals demand.
Three-month copper on the London Metal Exchange fell 0.5% to $7,888.50 a tonne at 0735 GMT, and the most-traded September copper contract on the Shanghai Futures Exchange declined 1.5% to 61,170 yuan ($9,004.99) a tonne.
"Base metals were just moving with U.S. equities this whole time. So now that there's retracement after a spectacular rally since mid-July, base metals are pulling back as well," said a trader.
Asian shares fell, tracking Wall Street's losses as the U.S. Federal Reserve looked set to maintain its path of interest rate hikes, despite signs it may be less aggressive in tightening gave investors some cause for hope.
Aluminium prices rose earlier in the session amid output cuts in Europe due to rising energy costs, but later succumbed to macroeconomic pressure as weak growth means subdued consumption for base metals, used in a vast amount of sectors.
ShFE aluminium rose as much as 1.1% before retreating to close down 0.9% at 18,330 yuan a tonne and LME aluminium fell 1% to $2,388 a tonne.
Fitch Solutions lowered their average LME aluminium price forecasts for 2022 to $3,000 a tonne, from $2,850 previously, and trimmed their 2023 forecast to $2,700 a tonne from $2,800.
"While we do not expect (aluminium) prices to collapse back to pre-COVID-19 levels yet, they will continue to be under pressure in Q3 2022," said Fitch Solutions in a note.
Industrial metal prices have been weighed by a firm dollar, which makes metals traded in the U.S. currency more expensive to holders of other currencies, rising interest rates and weak global demand.
LME zinc dropped 2% to $3,443 a tonne, ShFE zinc tumbled 4% to 24,590 yuan a tonne, ShFE tin shed 1.4% to 197,190 yuan a tonne and ShFE nickel declined 2.5% to 169,670 yuan a tonne.
For the top stories in metals and other news, click or ($1 = 6.7929 yuan) (Reporting by Mai Nguyen in Hanoi; Editing by Subhranshu Sahu, Rashmi Aich and Uttaresh.V)
