Copper rises as Goldman predicts run to record highs
Copper prices increased on Thursday in London amid expectations that loosening coronavirus restrictions in the world's largest customer China will spur demand. Goldman Sachs forecasts that prices might hit a record high of $11,000 in a year.
COPPER
In official open-outcry trading, benchmark copper on the London Metal Exchange (LME) was up 1.1% at $8,545 a tonne.
Prices dropped from a high of $10,845 in March due to weakening GDP in China and other countries, but the market is now predicting an economic comeback.
COPPER MARKET
Copper, which is used in electricity and construction, is up 4% this month after increasing 10.6% in November as anticipation for China's abandonment of its zero-COVID policies grew.
Wednesday saw the nation repeal important portions of such regulations.
Goldman Sachs analysts predicted prices would average $9,750 per tonne in 2023 and $12,000 in 2024. They said they now anticipate undersupply of copper in 2023 and that "peak supply is now immovably fixed in mid-2024 generating deficits from that point." They also predicted that China may attempt to rebuild depleted inventories next year, increasing copper demand.
COPPER RATE
In the meanwhile, China's Bank of Communications announced that it had struck agreements to help eight real estate companies, relieving a liquidity bottleneck in the industry, which is a significant consumer of metals.
However, the demand is still muted in the short run.
COPPER PRICE
According to data, China's sales of passenger cars declined in November for the first time in six months, premiums for Chinese copper imports are declining, and some people worry that lax COVID regulations could result in a sharp rise in infections.
LME lead gained 0.2% to $2,216, zinc jumped 1% to $3,216, aluminum increased 0.4% to $2,496 a tonne, and tin decreased 0.6% to $24,200.
Earlier, nickel soared to $33,575, its highest level since April, before dropping 0.6% to $31,250 a tonne.
After rising by 24% in November, the price of the metal used to make stainless steel has increased by around 16% this month. Traders attribute this increase in price to the market's severe volatility.
