Copper Hits One-Month Peak on Strong China Factory Data and Weaker Dollar
Three-month LME copper touched its highest since July 24 before easing, as a private survey showed China’s factory activity expanded at the quickest pace in five months.
Copper prices edged to their highest in more than a month on Monday, supported by upbeat manufacturing data from China, the world’s largest metals consumer, and a softer U.S. dollar.
Three-month copper on the London Metal Exchange (LME) touched $9,947 a metric ton, its strongest level since July 24, before trading at $9,886, down 0.2% on the session. LME copper has risen about 12% so far this year after rebounding from an early-April low near $8,105, the weakest level in more than 16 months.
Investors drew encouragement from a private-sector survey released Monday that indicated China’s factory activity expanded in August at the quickest pace in five months, driven in part by rising new orders. The survey — which measures activity in China’s manufacturing sector outside of official government statistics — suggested demand conditions were improving after months of uneven growth.
“If macro and cyclical conditions in China are generally on the up, that should be good for final demand,” said Nitesh Shah, a commodities strategist at WisdomTree. Shah noted that the positivity extended beyond raw materials into Chinese equities, which have shown gains in recent sessions.
A weaker dollar also helped underpin copper and other industrial metals, making dollar-priced commodities cheaper for holders of other currencies and supporting demand from overseas buyers. Currency moves often amplify commodity price swings, especially for metals widely used in global manufacturing and construction.
Market participants said the combination of improving Chinese industrial activity and a softer U.S. dollar offered a timely boost to copper, which is closely watched as a barometer of global economic health because of its widespread use in infrastructure and electronics.
LME-traded copper has been volatile this year, falling to the April trough before recovering as optimism about demand returned. Analysts have highlighted the interplay between China’s domestic activity, inventory levels at global exchanges, and currency fluctuations as key drivers of price direction.
Despite the recent gains, traders emphasized that prices remain sensitive to new data on Chinese manufacturing, global growth indicators and monetary policy developments that influence the dollar. Short-term moves can be pronounced, but the latest survey results have provided a clearer near-term signal of strengthening demand in the top metals market.
Another image captures industrial coils and finished copper products that illustrate the metal’s role in manufacturing and construction.
Broader commodity markets also took heart from the survey, with analysts saying renewed confidence in China’s manufacturing sector could support prices for other base metals and related industrial materials. Market watchers will be looking for follow-up data and official government releases to confirm the trajectory of activity in coming months.
For now, copper’s recent advance reflects improved sentiment about demand in China combined with currency dynamics that favor dollar-priced commodities. Traders cautioned that price momentum could change as new economic data and policy moves emerge, but said the latest readings offered a clearer near-term underpinning for metal markets.