New York, September 15: On Friday, copper futures on the Chicago Mercantile Exchange (COMEX) fell back after rising, but still rose more than 2% on a weekly basis.
As of the close, copper futures fell by 1.9 cents to 2.05 cents, with the most actively traded December 2023 copper futures closing at $3.801/lb, down 2.05 cents or 0.54% from the previous trading day.
December copper futures traded in a trading range of $3.7875 to $3.8515.
Copper rose 2.27% this cycle, which was the third rise in four weeks. Copper fell 3.52% in the previous cycle.
The U.S. dollar retreated slightly on Friday, rising 0.25% this week, its longest weekly rise in nine years. A strong dollar means dollar-denominated metals are more expensive for holders of other currencies. As energy markets continue to strengthen, rising fuel costs could add to U.S. inflationary pressures, forcing the Federal Reserve to keep its benchmark interest rate higher for longer.
The main driver of copper's rise this cycle comes from more data showing that China's economic outlook is improving. China's economy accelerated in August as a summer travel boom and massive stimulus boosted consumer spending and factory output, with industrial production and retail sales rising sharply from a year earlier, data showed on Friday, urban unemployment A slight decrease.
There are increasing signs that Chinese manufacturers are going through the most difficult period. The manufacturing purchasing managers index in August was close to the boom-bust line of 50, indicating that economic activity has stopped shrinking. New factory orders expanded for the first time since March. At the same time, the decline in Chinese exports narrowed, indicating that overseas demand may be stabilizing.
A day before Friday's report was released, the People's Bank of China announced a cut in bank deposit reserve ratios to increase liquidity and support economic recovery. This is also the second RRR cut this year.
But Friday's data wasn't all positive. Fixed asset investment in the first eight months of this year increased by 3.2% year-on-year, with the growth rate slowing down from the previous seven months, and the decline in real estate investment intensified.
COMEX copper futures (near-term contract) have fallen 0.24% so far this month and 1.10% so far this year. Friday's closing price is still 5.69% higher than the same period last year. For comparison, COMEX copper futures fell 14.58% in 2022, mainly because the global economic growth prospects are worrying, and high inflation has prompted European and American central banks to actively raise interest rates to curb inflation, which has intensified the risk of economic recession. In the medium to long term, however, the green transition of the global economy and electrification could help boost additional demand for the metal, which is widely used in the power and construction industries.
Looking from the external market, October 2023 copper futures on the Shanghai Futures Exchange rose 540 yuan on Friday (September 15) to 69,650 yuan/ton, an increase of 810 yuan or 1.18% from a week ago. Bonded copper futures for January 2024 on the Shanghai International Energy Trading Center (INE) rose 560 yuan to 61,720 yuan per ton, up 840 yuan, or 1.45%, from a week ago.
In the registered warehouse of the Shanghai Futures Exchange, copper inventory on Friday (September 15) was 65,146 tons, an increase of 10,191 tons from 54,955 tons a week ago. This is also the fourth consecutive week of inventory growth, and is still higher than the end of February. The peak of 252,455 tons was 74.2% lower.
On Friday, the trading volume of COMEX copper futures was 64,259 lots, compared with 74,503 lots on the previous trading day; the open volume was 196,561 lots, compared with 197,024 lots on the previous trading day.
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