Copper Hits Seven-Year High as Demand Hopes Build
(Bloomberg) -- Copper rallied for a fourth day to reach a seven-year high, adding to this week’s powerful surge across base metals on hopes for a post-pandemic demand boom.
The metal, which is used in everything from household wiring to electric vehicles, is gaining on optimism that the worst of the global economy’s coronavirus disruptions are over. The more bullish mood on demand coincides with falling global inventories that could leave the market short of supply heading into 2021.
“The market remains buoyed by fiscal stimulus measures across the world,” Australia & New Zealand Banking Group Ltd. analysts wrote in a note. Copper has risen about 70% since its March lows, amid the depths of the coronavirus crisis.
Copper rose as much as 1.5% to a seven-year high of $7,511 a ton, and was trading at $7,480 a ton by 12:31 p.m. London time. All other metals on the London Metal Exchange were higher.
The recent surge for metals has been powered by expectations that a coronavirus vaccine deployment next year will ease global economic pain, and mean China isn’t the only region driving demand growth. Dollar weakness has also helped. The metal is also gaining traction as a bet on hawkish climate policies that will expand copper-rich power networks.
China’s rapid economic rebound has driven its imports to record levels this year, helping to offset lower demand in the rest of the world. The country’s latest factory gauge, due Monday, is expected to show activity in the top copper consumer continuing a steady expansion.
On Friday, data from the Shanghai Futures Exchange showed copper stockpiles in its warehouses falling to the lowest since late 2014.
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