Copper faced its biggest decline in 19 months upon concerns on China’s economic health

The price of Copper

The price of copper subsequently fell last Wednesday and it is considered the biggest drop in 19 months, following a rise in inventories that have heightened concerns about China’s stagnant economic growth.

TD Securities’ associate commodities strategist Ryan McKay says the concerns regarding China is a big thing judging the immense build in the copper stocks of LME today and it adds to the worries on rising stockpile levels. McKay added that the production figures this week from China were weaker than expected.

Futures of copper edged down by 3.49 percent to settle at $2.5435 per pound, for the first time since April 6 they went under their 50-day moving average. This is also their biggest decline since September 2015. Metal prices have been continuously slipping in prolonged trade close to $2.53. In other metal, futures of iron ore dropped more than 6.5 percent last Wednesday.

However earlier in the week, the price of copper was on the positive territory in a month. Global traders already forecasted the price hike given a month-long strike that is projected at Freeport-McMoran’s Grasberg mine in Indonesia.

According a Reuters report, on-warrant stockpiles accessible for shipping at warehouses that are LME-registered was higher by 32 percent or 38,950 tonnes to 160,200 tonnes. The main poll for the economy of China, Caixin/Markit manufacturing PMI, posted an unexpected drop by 50.3.

Copper is a main metal utilized in industrial manufacturing, consumer goods and home construction across the world. The government of China placed huge amounts of loan last 2016 in an effort to rule out a rapid stagnation, given than the country is second largest economy in the world.

 

 

 

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