Copper Prices Rebound To Hit Six-Week High

Yolowire 29-Aug-2024 10:56 AM

%Copper prices are rebounding and at their highest level in nearly six weeks as optimism builds for lower interest rates in the U.S.

Copper is currently trading at $4.20 U.S. per pound. The price had been as high as $4.30 U.S. a pound in recent days, its highest level since mid-July when it was at $4.42 U.S. per pound.

The current price rise is a reversal for the red industrial metal, which had fallen to a four-month low in early August.

Copper’s price had declined as much as 24% earlier this year amid demand concerns in China and among electric vehicle manufacturers.

Analysts say hedge funds are again increasing their exposure to the base metal as expectations rise for interest rate cuts in the U.S. beginning in September, and for demand in China to improve leading into 2025.

Copper prices are expected to benefit from U.S. interest rate cuts as looser monetary policy alleviates the financial strain on manufacturers and construction firms, spurring demand in those sectors.

Copper is widely used across multiple economic sectors, notably within the energy transition. It is important to the manufacturing of electric vehicles and wind turbines, for example.

Despite the recent price correction, analysts largely remain bullish on the outlook for copper.

%Citigroup (NYSE:C) has gone so far as to forecast a super cycle for the metal.