Commdoities: Industrial metal and energy futures slip on coronavirus concerns

Commodity prices followed government bond yields lower on Wednesday as investors waited on the US central bank's policy decision.

Traders continued to try and guess what the final impact of the new coronavirus on Chinese economic growth and activity levels around the world would be.

On a relatively confident note, Credit Suisse strategist Andrew Garthwaite told clients that the virus could end up taking two tenths of a percentage point off the rate of global GDP growth in 2020.

However, he expected authorities in Beijing to mitigate much of the potential impact through expansionary fiscal and monetary policies.

Be that as it may, prices for industrial metals came under selling pressure, with three-month LME copper futures sliding from $5,707.0 per metric tonne at the open to $5,641.0.

The rest of industrial metals contracts on the LME all finished lower.

"Market conditions remain somewhat nervous, and despite further recoveries in equities, industrial commodities were still under pressure," said traders at Sucden Financial.

"As airlines cancel flights to/from mainland China, major banks and corporations keep staff at home, and governments rush to airlift citizens from affected areas, the knock-on effects of the China virus will doubtless be costly."

Energy futures were all trading down as well, save for Brent, with the March contract putting on 0.44% to $59.77 a barrel on the ICE.

Among soft commodities meanwhile, ICE traded cocoa was the exception, rising 0.89% to $2,727 per metric tonne.

From a bird's eye view, as of 1924 GMT the US dollar spot index was edging up 0.10% to 98.111 while the Bloomberg commodity index was sliding 0.59% to 75.87.