Copper prices rise and Goldman Sachs' outlook for the metal's future
Copper prices saw a significant jump during today's trading, recovering from losses incurred in the previous session, driven by a range of economic and strategic factors that have impacted global markets. This rise comes amid investor anticipation of supply and demand trends, particularly in light of geopolitical developments and major countries' plans to secure their reserves of vital metals.
Performance of futures contracts on the London Stock Exchange
In trading details, the most active copper futures contract on the London Metal Exchange (LME) 1.05% to $12,752.5 per ton . This corrective rise comes after the metal fell 1.8% in yesterday's trading, as prices faced pressure from a stronger US dollar, which makes dollar-denominated commodities more expensive for holders of other currencies, as well as concerns about rising inventories.
These trades took place amid relative calm in Asian markets, due to the Shanghai Futures Exchange being closed for the Lunar New Year holiday, which continues until February 23, thus reducing the volume of liquidity traded during the Asian session.
Copper stocks hit 11-month high
Regarding technical data on inventories, reports showed a significant increase in copper stocks held in warehouses approved by the London Metal Exchange. Inventories rose by 9,775 tons, bringing the total to 221,630 tons as of yesterday. This is the highest figure in approximately 11 months, reflecting a temporary surplus in available supply within official warehouses. This surplus had previously put downward pressure on prices before they rebounded, supported by future expectations.
Goldman Sachs forecasts and US strategic plans
In financial analysis, analysts at the global investment bank Goldman Sachs have revised their outlook for copper prices upward. The bank raised its forecast for average copper prices by 19%, predicting they will reach $11,200 per ton during the fourth quarter of this year.
The bank based its optimism on the United States' announced plans to establish a strategic reserve of critical minerals . This move, aimed at securing supply chains for the defense and advanced technology industries, is expected to create strong additional demand for copper in global markets, supporting the upward price trend in the medium and long term.
The economic importance of copper and its global impact
Copper is nicknamed "Dr. Copper" in economic circles due to its remarkable ability to reflect the health of the global economy. This metal is a cornerstone of the construction, infrastructure, and manufacturing sectors. With the accelerating global shift towards clean energy, copper has gained even greater importance as an indispensable component in the electric vehicle industry, renewable energy power plants, and smart grids.
Experts believe that any move by major economies, such as the United States or China, to boost their reserves of this metal will inevitably reshape the global price map, especially given the challenges facing the mining sector in meeting future growing demand.
