Copper rose to a two-week high on speculation that China, the world’s largest user of the metal, will take more steps to bolster growth.
China, where the economy expanded 7.6 percent from a year earlier last quarter, needs to adopt a “moderately easing” policy when growth is below 8 percent, the Shanghai Securities News reported today, citing Fan Jianping, the chief economist at the State Information Center. Odds that the People’s Bank of China will take action are rising as gains in consumer prices slow, according to Credit Agricole CIB.
“The markets seem to be focusing on expectations that the Chinese authorities will now accelerate policies to rev up their economy,” Edward Meir, an analyst at INTL FCStone in New York, said in a report.
Copper futures for September delivery climbed 1.7 percent to settle at $3.5345 a pound at 1:25 p.m. on the Comex in New York. Earlier, the price touched $3.545, the highest since July 3.
U.S. reports today showing a rise in jobless claims and an unexpected drop in sales of previously owned homes may add pressure on the Federal Reserve to take further steps to shore up the economy. Policy makers are ready to take steps to spur growth “as appropriate,” Fed Chairman Ben S. Bernanke said yesterday in a second day of testimony before lawmakers.
On the London Metal Exchange, copper for delivery in three months advanced 1.2 percent to $7,730 a metric ton ($3.51 a pound).
Aluminum, zinc, tin and lead also rose in London. Nickel fell.