Due to positive investor sentiment over potential interest rate cuts by the US central bank later this year, copper prices increased by 0.39% yesterday, closing at 763.15 rupees. The Federal Reserve decided against raising interest rates, but it did signal that it was prepared to lower rates by a minimum of 0.75 percentage points in the upcoming months despite recent signs of higher-than-expected inflation.
Despite the surprising acceleration of China’s industrial production in February, expectations for commodities purchases were dampened due to concerns about the country’s demand for manufactured products and new residences.
Smelters’ choices to reduce output at plants that were unprofitable because of shortages of raw materials helped to keep copper futures 5% higher for the month notwithstanding these circumstances. The National Bureau of Statistics in China reports that in January and February, the country’s output of refined copper increased by 10.7% over the same period last year, to an estimated 2.22 million metric tonnes.
But compared to the same month last year, Peru’s copper production decreased by 1.2% in January, coming in at about 205,375 metric tonnes. The Las Bambas mine owned by MMG produced 17% less than expected, while the Cerro Verde mine owned by Freeport-McMoRan produced 13.4% less than expected.
