Copper price recaptures $4 amid a solid turnaround from yearly lows
|- Copper price stages a solid comeback amid supply disruptions woes.
- Comex copper recaptures the $4-mark, USD weakness underpins.
- Risk flows boost the metal but recession and China covid concerns loom.
Copper price on Comex has snapped a three-day downtrend this Tuesday, staging an impressive rebound from the lowest level since January 2021 reached at $3.94 on Monday.
The turnaround in the price of the red metal is mainly driven by the risk-on market profile, as investors take stock of the recent sell-off in global markets amidst aggressive Fed’s tightening expectations and looming recession risks.
The safe-haven US dollar extends the previous downfall, in the wake of a better market mood, helping copper price recover some ground. Easing trade tensions between the US and China is also boding well for the commodity. “Biden has said he is considering removing some of the tariffs imposed on hundreds of billions of dollars worth of Chinese goods by his predecessor in 2018 and 2019 amid a bitter trade war between the world's two largest economies,” Reuters reported early Tuesday.
Additionally, the non-ferrous metal also capitalizes on the emerging supply disruption concerns after workers at Chile's state-owned Codelco, the world's largest copper producer, will start a nationwide strike on Wednesday to protest the government and the company's decision to close a troubled smelter.
Meanwhile, falling copper stockpiles at the LME-registered warehouse add to supply concerns, underpinning copper price. Despite the abovementioned positive catalysts for copper, the so-called economic bellwether remains at the mercy of the broader market sentiment.
Copper buyers remain wary over the fresh lockdowns in China’s Shenzhen and Macau cities, as covid flareups spread to the southern part of the country. Further, the central banks’ tightening outlook-induced recession fears also remain a drag on the metal’s recovery.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.