Copper price rose on Monday as industrial commodities benefit from growing optimism for an end to the Federal Reserve’s rate hikes.
Investors have been adding to bets that the Fed’s tightening cycle has ended after a series of US data points showed the world’s biggest economy is slowing.
Higher borrowing costs and a relatively strong dollar have been key headwinds for metals in the past two years.
In addition, hopes for stronger copper consumption were raised by a pledge from China’s central bank to ensure financing support for the property sector, a major consumer of industrial metals.
“There’s a fair amount of stimulus in the pipeline and we are in a seasonally strong period,” said Dan Smith, head of research at Amalgamated Metal Trading.
“For me, copper demand looks strong in China, primarily in the green sectors. We know utilization rates at wire rod plants picked up into mid-November.”
Copper for delivery in December rose by 2.1% on the Comex market in New York, reaching $3.81 per pound ($8,382 per tonne).
Concerns about reduced ore processing due to protests at First Quantum Minerals’ Cobre Panama mine, which accounts for 1% of global copper output, have contributed to supporting prices.
(With files from Reuters and Bloomberg)