Categories:
Base Metals
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General Market Commentary
Topics:
General Base Metals
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General Market Commentary
Bank of America ups copper forecast as red metal rises for a second straight month
- Copper prices are widely seen as a barometer for confidence in the global economy owing to its broad array of end uses.
- Bank of America analysts on Friday increased their price forecast for copper in 2020 by 5.4% to $5,621/t, while keeping the 2021 projection unchanged at $6,250/t.
Copper prices closed out a second consecutive month of gains on Friday, driven in part by hopes for a recovery and further fiscal and monetary stimulus from China, its number one consumer.
Although tensions between the U.S. and China over the coronavirus pandemic and new Hong Kong security laws capped gains toward the end of the month, copper priced on the London Metal Exchange closed out Friday’s trading day at $5,332.25 per ton.
The red metal’s spot price closed out May down more than 13% for the year-to-date, having plunged as low as $4,617.50/t in late March as the pandemic spread throughout the world.
Copper prices are widely seen as a barometer for confidence in the global economy owing to its broad array of end uses.
Bank of America analysts on Friday increased their price forecast for copper in 2020 by 5.4% to $5,621/t, while keeping the 2021 projection unchanged at $6,250/t.
BofA metals analysts said that while demand had collapsed due to the coronavirus pandemic, a rebound of activity in China was a positive sign for copper.
“Global copper consumption could contract by 18% year-on-year in 2020, if global GDP (gross domestic product) drops by 4.2% year-on-year, the base case of our economists,” BofA said in a note Friday.