Copper climbed to a three-week high in New York on speculation that central banks in China and the U.S., the world’s biggest metals consumers, will maintain policies aimed at stoking economic growth.
Federal Reserve Chairman Ben S. Bernanke yesterday called for continuing stimulus “for the foreseeable future.” Chinese Premier Li Keqiang said policy should ensure economic activity moves within a reasonable range, according to a Xinhua News Agency report posted on the government’s website. The remarks signal that the nation may soften its monetary stance, according to Nomura Holdings Inc. China’s benchmark equity index posted its biggest two-day gain in 18 months.
“A softening in Ben Bernanke’s stance toward tapering saw markets rally strongly,” Leon Westgate, a London-based analyst at Standard Bank Plc, said in a report today. “Comments from Chinese Premier Li Keqiang stating that economic growth and employment must stay above a certain floor also gave Chinese equity markets an additional boost. The base metals have surged higher as a result, with copper leading the charge.”
Copper futures for delivery in September gained 2.8 percent to settle at $3.1775 a pound at 1:15 p.m. on the Comex in New York. Prices rose for a third time in four sessions and touched $3.201, the highest since June 18. The metal has dropped 13 percent this year amid concern that slowing Chinese demand would add to a supply surplus.
Stockpiles monitored by the London Metal Exchange fell for a fifth session to 645,175 metric tons, the lowest since June 21. Inventories have more than doubled this year. Orders to remove the metal from warehouses dropped for a 10th session, the longest streak since December.
On the LME, copper for delivery in three months added 2.6 percent to $7,000 a ton ($3.18 a pound).
Zinc, aluminum and lead also climbed, while nickel and tin were lower.