Copper prices rallied to a three-month high on Tuesday on increasing optimism about demand in China following strong manufacturing data, while the dollar weakened.
Copper prices at the London Metals Exchange rose 0.7% to $9935 a ton, after scaling March 27 highs at $9984.
A recent survey showed China’s factory activities grew in June, boosted by increasing orders after a month of contraction.
Also a weaker dollar boosted the greenback-denominated copper futures as they became cheaper to global traders.
Lower inventories also helped, with copper stocks falling at the London Exchange by 66% since mid February to 91,250 tons.
At the Shanghai Exchange, inventories fell 66% as well from early March levels to 81,550 tons.
The price premium between spot prices and three-month futures stood at $319 a ton last week, the highest since October 22, below falling to $120 on expectations of extensive deliveries.
The Trump Factor
Continuous threats by US President Trump to impose tariffs on copper imports also served to boost prices at the COMEX exchange, boosting the US premium over London prices.
As for other industrial metals:
Aluminum rose 0.4% to $2608 a ton
Zinc fell 0.9% to $2727
Lead was unchanged at $2044
Tin rose 0.4% to $33850
Nickel fell 0.2% to $15,185
Otherwise, the dollar index fell 0.2% as of 15:24 GMT to 96.7, with a session-high at 96.8, and a low at 96.3.
Copper September futures rose 1.9% in American trade as of 15:20 GMT to $5.18 a pound.
