Copper Not Convinced Despite China’s Reassurances

Despite reassurance from China’s central bank that it would prevent a credit crunch, investors were not fully reassured. Copper futures on the London Metal Exchange fell more than $20 to $6,772 per tonne June 26. The Comex also saw a drop in copper, with prices sinking $0.85 per ounce to $3.06 a pound.

According to Ross Strachan, economist at Capital Economics, the dip in copper prices are a result of the U.S. Federal Reserve potentially scaling back their stimulus and weak signs from China.

“Looking at fundamentals it would suggest that there is further downside for copper,” he told Reuters. “We expect prices to fall below $6,000 a tonne next year due to additional mine supply and the weak state of demand.”