Copper Gains on Improving U.S. Economy, China Stimulus
New York (Dec 11) Copper futures rose as signs of a strengthening U.S. economy and speculation that China will move to stimulate growth boosted prospects for metal demand.
U.S. retail sales gained by the most in eight months and jobless claims dropped to a three-week low, government reports showed today. China’s central bank began injecting 400 billion yuan ($65 billion) into the banking system, according to a person familiar with the matter. Copper headed for the second straight weekly gain, the longest rally since October.
“Copper was helped by some better-than-expected economic data in the U.S.,” David Meger, the director of metal trading at Vision Financial Markets in Chicago, said in a telephone interview. “There’s ongoing expectation that China will continue to stimulate its economy, and where China goes is where copper goes.”
On the Comex in New York, copper futures for March delivery climbed 1 percent to $2.921 a pound at 1:12 p.m. The metal has gained 0.6 percent this week. China is the world’s top consumer, followed by the U.S.
Last month, China’s central bank unexpectedly lowered its benchmark lending rate. Producer prices fell last month and consumer prices rose at the slowest pace since 2009, signaling room for further monetary easing, data showed yesterday.
“China’s economic slowdown has continued, while the commodity-intensive parts of the economy are particularly weak,” National Australia Bank said in a report.
On the London Metal Exchange, copper for delivery in three months rose 0.7 percent to $6,462.50 a metric ton ($2.93 a pound). The price has dropped 12 percent this year.
Aluminum, nickel and lead fell in London. Tin and zinc rose.