New York, July 20 news: Copper futures on the Chicago Mercantile Exchange (COMEX) closed higher on Thursday, the first rise in five trading days.
As of the close, copper futures rose by 1.8 cents to 2.55 cents. Among them, the most actively traded September 2023 copper closed at $3.8345 per pound, up 2.05 cents or 0.54% from the previous trading day.
September copper traded in a range of $3.811 to $3.8885.
Judging from the spot demand of the top metal consumer country, spot copper consumption is still weak, which is reflected in the weakening premium of spot copper. But while China's copper demand remains lackluster, analysts at Bank of Australia said the ongoing copper supply deficit would give copper huge upside potential once Chinese demand shows signs of improvement.
At the same time, the market hopes that the rate hike cycle in western economies may be drawing to a close, especially given that UK inflation is also showing signs of falling. Traders expect next week the Federal Reserve will raise interest rates for the last time in this round of monetary tightening cycle. Aggressive rate hikes by the Federal Reserve since last March have led to higher borrowing costs, slowing economic growth and hurting demand for commodities including copper.
The near-term contract of COMEX copper futures has risen 2.04% so far this month and 0.32% so far this year. The closing price on Thursday was 15.61% higher than that of the same period last year. In contrast, COMEX copper futures fell by 14.58% in 2022, reflecting the worrying outlook for global economic growth. High inflation has prompted central banks in Europe and the United States to actively raise interest rates to curb inflation, while higher borrowing costs have exacerbated the risk of economic recession. In the medium to long term, the green transition of the global economy and electrification are helping to boost additional demand for the metal, which is widely used in the power and construction industries, while copper mine production has been disrupted.
The most actively traded August copper contract on the Shanghai Futures Exchange rose 100 yuan to close at 68,330 yuan a ton on Thursday. Bonded copper for October delivery on the Shanghai International Energy Exchange (INE) rose 50 yuan to close at 60,780 yuan a tonne.
On Thursday, the trading volume of COMEX copper futures was 78,252 lots, compared with 64,070 lots in the previous trading day; the number of open positions was 218,019 lots, compared with 216,862 lots in the previous trading day.
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