Copper has rallied for the last five months on supply shortfalls as well as demand that’s being supported by the artificial intelligence boom, turbocharging consumption of the metal that’s used in wiring and renewable energy equipment. Frenzied buying across multiple metals in China has stoked the gains in recent weeks while the debasement trade, where investors avoid traditional financial assets, is also helping.
“Copper is tracking silver and gold” as optimism toward metals improves, said Wu Kunjin, head of base metals research with Minmetals Futures Co.
China’s gross domestic product rose 5% last year, according to official data released Monday (Jan 19), despite a pronounced slowdown in recent months. However, Chinese home prices fell in December, a sign that the country’s property downturn, which has weighed on demand for metals, is far from over.
Chinese aluminium output, meanwhile, rose to a record high last year, climbing above the country’s capacity limit, according to data released Monday. Steel production fell to a seven-year low.
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Copper rose 1.3% to US$12,965 a tonne on the London Metal Exchange as of 11.15am in Shanghai. Nickel jumped 2.6% and tin was up 2.8% while aluminium climbed 0.8%.
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