Copper Traders Turn Optimistic

Demand for copper has increased recently as economies have been recovering. Barclays Capital has forecast a likely shortfall of supply. This is despite the fact that China has recently been growing at a slightly slower pace. Based on Barclays data, the usage of copper is China (40%), North America (11%), and Japan (5%). For the first time in a year, the IMF has raised their forecast for global growth potential.

This demand has been exacerbated by the recent positive German business confidence numbers. However, Goldman Sachs has predicted that China is likely to tap local reserves in the near future and thus decrease imports, which should place downward pressure on copper prices. As well, bourse data shows that supply may also be limited by inventory ownership.

Source: Bloomberg

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