Copper Advances to Three-Week High on China-Demand BetsJoe Deaux and Agnieszka de Sousa
Copper futures rose to a three-week high after China’s central bank cut an interest rate for the second time in a month, fueling speculation that lower borrowing costs will spur economic growth and demand.
The bank sold 14-day repurchase agreements at 3.4 percent today, compared with 3.5 percent on Oct. 9. Copper has dropped 9 percent this year on signs of a slowdown in China, which according to Standard Chartered Plc accounts for 45 percent of world demand. The nation’s growth last quarter probably eased to a five-year low of 7.2 percent, a Bloomberg survey of economists showed before data due Oct. 21.
“The interest rate change provides a little bit of comfort around China, where we haven’t seen positive news,” Vicky Sanders, head of analytics sales at Marex Spectron Group in London, said in a telephone interview.
Copper futures for December delivery added 1.6 percent to settle at $3.09 a pound at 1:12 p.m. on the Comex in New York after reaching $3.1045, the highest since Sept. 19.
Prices rose yesterday after China reported an increase in exports, boosting the global demand outlook for the metal.
On the London Metal Exchange, copper for delivery in three months increased 1.3 percent to $6,800 a metric ton ($3.08 a pound).
Orders to remove the metal from warehouses monitored by the bourse climbed 33 percent, the most since May 2013, to 26,300 tons on an increase in New Orleans, the biggest LME copper repository.
Nickel, lead, and tin fell in London, while zinc and aluminum rose.