bloomberg-Copper rallied as metal markets renewed their advance on stronger oil prices and optimism over demand in the U.S.
Oil climbed on speculation OPEC will agree to cut output when members meet in Vienna next week. Higher oil prices boost mining production costs, discouraging expansion of mines. The Bloomberg Dollar Spot Index fell for the first time in four days, boosting the appeal of the metal for holders of other currencies.
“Copper had a nice little rally here -- part of it can be traced to the move in the U.S. dollar,” Bart Melek, the head of commodity strategy at Toronto-Dominion Bank in Toronto, said in a telephone interview. “It’s responding to quite a bit of U.S. optimism after Mr. Trump was victorious and is now the president-elect.”
Copper futures for March delivery rose 2 percent to $2.5275 a pound at 1:11 p.m. on the Comex in New York, posting the biggest gain in more than a week. Copper for delivery in three months rose 2.5 percent to $5,559 a metric ton ($2.52 a pound) on the London Metal Exchange.
Money managers boosted their bets for copper price gains on the Comex to the highest ever.
The LME’s index of metal prices slid 1.9 percent last week, the most since August, after the outlook for higher U.S. interest rates boosted the dollar and curbed demand for commodities.
Global copper inventories tracked by the LME have slumped 34 percent since the end of September, snapping six months of gains and signaling that demand may be accelerating. The decline for supplies comes as Donald Trump, who secured a win in the Nov. 8 U.S. election, reiterated the importance of infrastructure spending in his victory speech.
“Confidence is creeping back into the markets,” Malcolm Freeman, a director of Kingdom Futures Ltd. in London, said in an e-mailed note.
The other five main metals traded on the LME also rose. Nickel was the biggest gainer, increasing 5.1 percent to $11,400 a ton.
A gauge of 18 base-metals producers tracked by Bloomberg Intelligence climbed 2.5 percent, led by Freeport-McMoRan Inc., Vale SA and Teck Resources Ltd. Vancouver-based First Quantum Minerals Ltd. rose as much as 7.7 percent in Toronto trading.