LONDON – Copper skidded to the lowest since mid-2017 as investors faced fresh evidence of a global slowdown and fading prospects for a deescalation in the US-China trade war.

Long known as a canary in the coal mine for the economy, copper has slumped 16% since mid-April on the back of a sharp downturn in factory output and warnings that major economies are heading into recession. Prices fell 1.8% to $5 520/t on the London Metal Exchange on Tuesday.

A rallying dollar is also piling pressure on industrial metals, with buyers using other currencies seeing their purchasing power steadily erode as the greenback climbs. China’s onshore yuan hit the lowest since 2008 on Tuesday, spurring losses across the LME’s suite of dollar-priced contracts. Copper, lead, tin and zinc fell at least 1%.

“The selling has already gone a long way, but we can’t rule out the possibility copper will go lower,” Xiao Fu, head of global commodities strategy at BOCI Global Commodities UK, said by phone from London. “If the macro picture remains weak or we see other negative shocks coming into the picture, we could see further selloffs.”

While delegates from Washington and Beijing struggled to agree on terms to restart trade negotiations, research houses from Oxford Economics to Nomura warned that China’s economic activity will soften further. China’s growth slowed to 6.2% in the second quarter, the slowest pace in almost three decades.

Sentiment in metals markets took a further hit as global electric vehicle sales fell for the first time in modern history, fueling doubts about one of the few bright spots for demand.

The poor macroeconomic conditions have also negated signs of rising spot demand for metal on the LME. Orders to withdraw copper in warehouses tracked by the bourse rose to the highest in a year on Tuesday, continuing a sharp rebound seen since late August.

The muted price reaction is understandable, with broader markets bracing for a further possible deterioration in economic data, particularly in the U.S. and China, Fu said. “There are further risks coming up, given the lackluster backdrop for global demand growth.”