The copper price rebounded on Thursday as the dollar weakened, forcing speculators to scramble to buy back their bearish positions.
Copper for delivery in September rose 1.7% on the Comex market in New York, touching $3.52 per pound ($7,744 per tonne).
[Click here for an interactive chart of copper prices]
“The buying was largely based on technical levels because the short-term trend in copper had become bullish,” said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.
Copper has lost nearly 30% since hitting a record high of $10,910 a tonne in March.
This week’s recovery, however, is only a temporary bounce within a wider bear market, said Tom Price, head of commodities strategy at Liberum.
“The main drivers of industrial metals were still pointing to weaker prices, including a slowdown in top metals consumer China,” he added.
“China has given up on its 5.5% GDP growth target and that tells me that any sort of stimulus before the end of the year is just going to support activity, rather than drive it to higher levels,”
(With files from Reuters)