Editors: Steve Stroth, Patrick McKiernan
Copper rose to a 16-week high on speculation that the government will seek to spur economic growth in China, the world’s biggest consumer, amid signs of tighter global supplies.
China’s economy expanded at the slowest pace in 10 quarters, signaling the government may ease lending curbs and increase spending, bolstering demand prospects. Output of mined copper slid 23 percent last year from 2010, Rio Tinto Group, the world’s third-largest mining company, said today.
“As long as there’s the threat of a slowdown, the pressure will be there for China to stimulate the economy,” Dennis Cajigas, a senior market strategist at Zaner Group in Chicago, said in a telephone interview. The Rio Tinto “figures are a factor as well,” he said.
Copper futures for March delivery gained 2.5 percent to settle at $3.7295 a pound at 1:19 p.m. on the Comex in New York, after reaching $3.759, the highest for a most-active contract since Sept. 21.
On the London Metal Exchange, copper for delivery in three months rose 1.4 percent to $8,200 a metric ton ($3.72 a pound).
The price may climb to $9,000 in the middle of the year, partly on rising Chinese demand, Goldman Sachs Group Inc. said yesterday.
Copper inventories monitored by the LME declined for the 10th straight session to 353,425 tons, the lowest since Dec. 14, 2010.
Aluminum, zinc, lead, nickel and tin also advanced in London.