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The dollar was close to 20-year highs, which makes dollar-priced metals costlier for buyers with other currencies and can deter buyers.

Pushing it up are an energy crisis in Europe and strict covid-19 controls in China that have slowed economic activity and hammered the yuan and euro.

Sky-high energy prices in Europe have forced smelters to reduce output — with France’s biggest aluminum smelter the latest to cut — but they also harm other industries, shrinking demand.

Benchmark aluminum on the London Metal Exchange (LME) was down 0.3% at $2,278 a tonne at 1044 GMT.

The metal used in construction, transport, and packaging is down 44% from a high in March and down 19% this year.

Prices are unlikely to recover until the dollar stops rising, said Saxo Bank analyst Ole Hansen.

“Metal consumption should decline, driven by a Europe-led downturn in the months ahead,” analysts at Citi said.

But Citi said supply cuts may still push aluminum up.

Aluminum smelters in Europe have already cut capacity by a million tonnes since energy prices began rising in 2021 and analysts are braced for more.

On Tuesday, a source said France’s Aluminium Dunkerque would cut production by one-fifth and Norsk Hydro said it would keep a small portion of its capacity in Norway offline after maintenance.

However, aluminum stocks in LME-registered warehouses rose by 31,325 tonnes to 308,375 tonnes on Tuesday, easing supply worries.

LME stocks are down from almost 2 million tonnes in March 2021 but outflows halted in recent weeks.

In China, meanwhile, the central bank moved to support the yuan and officials signaled a renewed sense of urgency on the economic stimulus that should support metals demand.