Copper Prices Soar to Weekly Highs as Global Economy Showcases Strength

Copper prices have increased to their highest level in over a week, thanks to optimistic factory data from China. The world’s largest consumer of the metal has seen its official manufacturing purchasing managers index reach its highest level in a year, along with strong exports and rising consumer prices. This has boosted market sentiment and led investors to feel more positive about China’s economy.

In addition, a factory gauge in the US also showed signs of improvement, ending 16 months of decline. This positive economic data is supporting the consumption of raw materials like copper, which is facing concerns about supply shortages. Despite this, China’s leading smelters are considering output cuts as processing fees have dropped to near zero.

While there are concerns about supply shortages, there are also worries that the Federal Reserve may be slow to cut interest rates. Bond traders are predicting less easing by the Fed this year, with odds of a rate cut in June briefly falling below 50%. Copper prices on the London Metal Exchange rose 1% to $8,956 a ton, while nickel also increased by 0.8% to $16,875 a ton. Aluminum prices remained near their highest level in three months.