Copper prices soared to their highest levels since June 2022 on Friday, propelled by investor expectations of an impending demand upswing amid prospects of interest rate cuts in the near future. Despite weaker-than-expected credit data from China and disappointing trade numbers, the market remained resilient, with investors displaying strong enthusiasm for industrial metals.
Benchmark copper on the London Metal Exchange (LME) rose by 1.2% to $9,452 per metric ton, reaching a session high of $9,590.50 per ton, reflecting the robust investor sentiment and the anticipation of heightened demand in the power and construction industries.
The surge in copper prices is part of a broader trend, with aluminium prices reaching their highest levels since February 2023 and zinc hitting one-year peaks, driven by a flood of liquidity into the metal markets and a positive growth outlook for the coming months. Economic recovery indicators, particularly in China, have played a pivotal role in triggering a surge in buying activity, with Chinese PMI data highlighting the manufacturing sector’s expansion at the fastest pace in 13 months, driven by robust domestic and international orders.
In addition to demand optimism, concerns about supply disruptions leading to shortages of concentrate used in refined metal production have provided further support for copper prices. The constrained copper mine supply is increasingly impacting refined production, underscoring the bullish outlook for both copper and aluminium prices.
BoA Securities has expressed bullish expectations for copper and aluminium, forecasting average prices of $12,000 and $3,250 per ton respectively by 2026, reflecting sustained confidence in the metals’ long-term potential. Meanwhile, other industrial metals, including zinc, lead, nickel, and tin, have also experienced notable price movements, signaling a broader trend of positive market sentiment and demand expectations across the industrial metals sector.