Copper prices were upbeat during early trade in Europe today, as the dollar extended a retreat from a monthly peak. Bearish manufacturing data from China and upbeat production figures from Chile failed to spark a selloff for the red metal, indicating that investors see healthy underlying demand.
Copper futures for September delivery on the COMEX division of the New York Mercantile Exchange had climbed 0.41 percent to $2.642 per pound as of 08:40 BST today. The contract has been trading mostly sideways for the past month, though it closed June for a four percent loss and logged a three-month low of $2.566.
Following the turmoil that Greece caused on the markets in the past week, investors have calmed. The euro climbed back to prior levels, while the dollar dipped, which propped up commodities across the board.
Copper has recovered from the unexpectedly low impact of below-par readings on China’s manufacturing PMI on Tuesday. HSBC’s closely monitored manufacturing PMI was again below the key 50.0 mark, which separates growth from contraction, while the government’s PMI was logged at 50.2.
China accounts for about 45 percent of global copper consumptions, and its manufacturing sector is a leading influence on industrial metals demand and the most important indicator for the health of the economy in general.
Meanwhile, a report on Tuesday from Chile, the world’s foremost producer of the red metal, revealed that copper output in May had grown 2.1 percent on an annual basis to 508,245 tonnes, which is also an eight percent increase on April. Year-to-date production in the country is up 2.3 percent from last year, signalling robust supply despite expectations of a slow decline.