Chart of the week: Dr Copper diagnoses an ailing economy
The price of copper has slipped by a fifth this year and is now at a near-two-year low of around $5,600 a tonne.
"Dr. Copper has delivered a verdict and it is not good," says Neil Hume in the Financial Times. The red metal is used in a wide array of industries, notably electronics and construction, so it is widely deemed a barometer of global activity. The price has slipped by a fifth this year and is now at a near-two-year low of around $5,600 a tonne.
A gauge of US manufacturing has hit a decade-low, while its eurozone equivalent has fallen to a seven-year trough. Weakening demand has negated the impact of a 2% drop in mined supply this year. Longer term, however, the outlook for copper is auspicious: an electric car uses three times as much copper as a conventional one, while miners have struggled to find big, high-quality deposits.
Viewpoint
Michael Lewitt, The Credit Strategist