Copper hit its highest price in three months earlier in the session, supported by robust demand from major importer China along with a weakened dollar.
Prices remain slightly under that mark after topping Thursday’s heights earlier in the session following manufacturing PMI data from China that outperformed forecasts.
Copper supply imbalance pushes prices higher
The Chinese demand makes up nearly 50% of the world’s total copper purchases, helping propel prices higher amid the latest bout of supply tightness. Energy consumption for the country, which is usually a reliable indicator of Chinese demand for the metal climbed by 6% during the month of April, giving support to investors to expand exposure to copper investments.
Recent softness in the greenback has provided additional support to prices, as the weakened currency means the dollar-priced metal is more affordable for consumers purchasing in cross currencies. In terms of supply, copper futures in LME reserves fell by more than -30% from the start of May, declining to 243,300 tonnes while highlighting the imbalance between supply and demand. As a result, price movement has turned bullish. Should prices finish the session higher than $2.700, copper has the potential to rebound as high as $2.800 per pound
