Copper prices recorder their steepest drop in seven weeks on concerns that a Chinese probe into the use of metals for obtaining loans would hurt demand, The Wall Street Journal reported. Chinese authorities are investigating whether companies used the same metals held back as stock at a Qingdao port as collateral for multiple loans. Investors fear the investigation will lead to a wider clampdown on lending practices involving commodities, estimated to tie up as much as one million tons of copper, forcing companies to sell commodities they had been using as collateral and flood the market.
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