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By Polina Devitt
LONDON, Dec 16 (Reuters) - Copper prices retreated on Tuesday as investors assessed the latest U.S. jobs data while thin year-end liquidity exacerbates price swings.
Benchmark three-month copper on the London Metal Exchange lost 0.3% to $11,624.50 a metric ton by 1720 GMT. It hit a record of $11,952 on Friday on concern over tight supply.
The U.S. data showed the November unemployment at more than a four-year high, though the recent government shutdown created some uncertainty over what this report means for the economy and the Federal Reserve’s policy outlook.
With thin liquidity, price swings in base metals are becoming increasingly exaggerated, leaving the complex vulnerable to abrupt moves into year-end, Sucden Financial analysts said.
Copper is up 33% this year, on track for its most annual growth since 2009 after several mine disruptions, outflows to stocks in the U.S. and expectations of future soaring demand from AI data centres and energy transition.
"We expect this year’s surplus to swing to a market deficit next year," said WisdomTree commodities strategist Nitesh Shah.
"Demand may be muted now, but it is more about the expectations that copper is going to benefit as the world electrifies."
Among other LME metals, aluminium rose 0.5% to $2,879 a ton. Daily LME data showed that on-warrant aluminium stocks in LME-registered warehouses fell to 452,600 tons after cancellation of 32,025 tons in Malaysia.
Adding further support, Australia’s South32 said it would place the Mozal aluminium smelter in Mozambique under care and maintenance by March after failing to secure a power deal with the government.
LME zinc dropped 1.9% to $3,035.50 while lead gained 0.1% to $1,943 after hitting $1,937.50 for its lowest since May. Both metals had major deliveries to LME stocks, mainly in Singapore.
Nickel was down 0.6% at $14,270, having touched an eight-month low of $14,235 on Monday, while tin eased by 0.1% to $40,875.