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Solid Economic Growth in China Promises Robust Demand for Copper

July 17, 2017 at 19:19 by Vladimir Vyun

Copper prices surged more than 1% today thanks to positive economic data from China, the world’s top consumer of the industrial metal. Gross domestic product rose 6.9% in the second quarter of 2017 from Q2 2016, above the median forecast of 6.8%. Industrial production grew by 7.6% in June from the same month of the previous year, far more than the predicted figure of 6.5%. All that promises robust demand for the metal from the world’s second biggest economy.

Analysts expect that global deficit of copper will widen this year, though they think that it is already priced in. Moreover, experts anticipate that the balance will shift into surplus next year.

Prices for copper also got a boost from the same factor that was helping other metals — weakness of the US dollar due to doubts that the Federal Reserve will be able to continue its monetary tightening cycle this year.

Futures for delivery of copper in September gained as much as 1.37% to $2.728 per pound as of 19:10 GMT on COMEX today.

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