Copper price rises as China’s factory activity accelerates
The copper price rose on Friday after a surprise boost in Chinese factory activity lifted hopes for improved demand.
Copper for delivery in July was up 1.88% on the Comex market in New York, touching $3.78 per pound ($8,316 per tonne).
The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) on Thursday showed that Chinese manufacturing activity unexpectedly swung to growth in May, contradicting a weaker official PMI reading earlier in the week.
Meanwhile, the US Senate passed legislation to raise the government debt ceiling.
With investors also betting that the US Federal Reserve will not raise interest rates further at its next meeting, appetite for riskier, growth-linked assets grew.
Global stock markets rose and the dollar was heading for its biggest weekly drop since January, helping dollar-priced metals by making them cheaper for buyers with other currencies.
Economic and factory growth remain weak globally, but investors appear to have exhausted their desire to sell copper, said Saxo Bank strategist Ole Hansen.
Copper could move higher if it closes above its 200-day moving average, currently around $8,375, but a period of price consolidation is likely, Hansen said.
“To move higher, we need some improvement in the economic numbers,” he added.
