Why Copper Could Reach $3 In The Near-Term

In 2018, the price of copper moved to a high of $3.3 an ounce. The year’s high was reached in June. Then, as the world was entering a phase of slower growth, the price dropped sharply. Ultimately, the price reached a low of $2.50 in August. Then, the price started moving in a narrow range of between $2.8 and $2.5. This week, the price of the metal has fallen to $2.60.

Copper is an important industrial metal that is mostly used in the electrical field because of its good conduction qualities. For this reason, it is often viewed as the barometer of the world economy. This is because a good and growing economy leads to more demand for the metal.

Most of the world’s copper is mined in Chile by companies like Codelco, Freeport Mcmoran, and BHP Billiton among others. Most of the mined copper is bought by China, which is known as the world’s factory. India and Japan are other important copper consumers. Therefore, as investors have continued to remain worried about the global economy, the price of copper has taken a hit. As the negotiations between the US and China continue, the price of copper will be watched closely by investors. A good deal could see the price of the metal reach a high of $3 as shown below.

(Click on image to enlarge)

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