Copper’s shine will fade

Copper has gained around 10% since the start of 2017. But don’t count on high prices lasting.

Copper has gained around 10% since the start of 2017. China comprises 45% of global consumption, and so prices of the red metal tend to track the prospects for Chinese industrial activity. These have brightened in recent months thanks to government stimuli.

Traders are also pencilling a bounce in global growth following a Trump stimulus. Strikes in Chile mean a tenth of copper production capacity "could be out of action soon".

But don't count on high prices lasting, says Capital Economics. Markets are over-optimistic about Trump's stimulus, and the Chinese authorities, mindful of the ever-growing debt pile, are unlikely to keep stimulating growth.

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Andrew Van Sickle
Editor, MoneyWeek

Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.

After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.

His freelance projects have included a 2009 relaunch of The Pharma Letter, where he covered corporate news and political developments in the German pharmaceuticals market for two years, and a multiyear stint as deputy editor of the Barclays account at Redwood, a marketing agency.

Andrew has been editing MoneyWeek since 2018, and continues to specialise in investment and news in German-speaking countries owing to his fluent command of the language.