The price of copper rose to a record high at $9044 setting a new record at the London Stock Exchange on Tuesday. The possibility that demand for the metal used in construction and manufacturing could rise after US President Barack Obama agreed to extend tax cuts to the wealthiest Americans for two more years in hopes that the move will stimulate economic growth.
Media reports that JP Morgan bought $1.5 worth of copper from the London Metal Exchange. Macquarie deputy head of commodities Max Layton says the recent $1.5bn purchase of copper on the London Metal Exchange has sparked a surge in the price of copper, which hit an all-time high yesterday above $9,021 a tonne.
Recent price rises have largely been buoyed by fundamental factors, such as growing consensus on the copper supply deficit level, as well as the large $1.5bn trade. The copper demand will exceed supply by 500 thousand tons next year according to specialists and experts therefore the price of copper will continue to increase.