Copper Near 3-Month High

China accounts for almost half of the global copper demand. Power consumption in the country, normally a good indicator of the metal’s demand, rose 6.00% in April, encouraging investors to increase their bullish bets on copper.

The recent weakness in the US dollar is further supporting prices, as a cheaper greenback makes the dollar-denominated industrial metal cheaper for foreign consumers.

Furthermore, strengthening manufacturing fundamentals highlighted by the PMI figure overnight suggests that economic activity remains robust, helping improve the copper outlook.

On the supply side, copper stocks in London Metal Exchange warehouses are down over -30.00% since early May to 243,300 tonnes, reflecting the tightness in the market. The resulting price action has seen the near-term trend turn decidedly bullish.

If prices manage to record a daily close above $2.700, copper could conceivably rally all the way to $2.800 a pound.

Consumers in the UK suffered a sharp drop in confidence in June amid rising inflation and tepid wage growth.

A leading survey conducted by market research firm GfK showed that the group’s monthly measure of consumer confidence sank to -10 this month, easily missing a median forecast of -7.

The survey covered the period before and after the June 8th parliamentary polls, which saw the ruling Conservative party lose its majority. The domestic-driven UK economy managed to weather the initial post-Bexit uncertainty on the back of consumer resilience. However, growing inflation accentuated by depreciation in the pound has squeezed consumer wallets, resulting in a slump in sentiment.

The FTSE 100 index is dipping in early Friday trade, with the benchmark last seen trading around 7280 after rebounding earlier from strong support sitting near 7250.