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Copper Fundamental Analysis – week of June 13, 2015
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Copper continued to fall giving up 4% to trade at 2.027 and is down almost 5% YTD as Chinese demand fell. copper ticked lower on Friday, and was facing
Copper continued to fall giving up 4% to trade at 2.027 and is down almost 5% YTD as Chinese demand fell. copper ticked lower on Friday, and was facing its largest weekly loss in more than a month as headwinds from a mid-term U.S. rate hike that have boosted the dollar added to pressure from tepid physical demand in top user China.
The number of Americans filing for unemployment benefits unexpectedly fell last week, pointing to sustained strength in the labor market despite a sharp slowdown in hiring last month, and adding to gains in the dollar.
“Looking ahead, we expect to see some short-term headwinds to metals, especially in copper, due mainly to weak summer demand and stocks reshuffling,” said Argonaut Securities in a note.
“That said, the continuous policy supports on the fiscal side and recovery in the property sector will put a floor on commodity prices… Any hold-off on the Fed rate hike and the resulting weakness in the U.S. dollar will be boon to metals.”
After more than halving over the past year global LME stocks this week shot up more nearly 40% driven by massive deliveries into Asian warehouses from Chinese stockpiles. The copper market is also back in contango (when copper for delivery in the future is more expensive than spot) after a being in elevated backwardation for most of the year which means plenty of metal is available in the market.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.
Major Economic Events for the week:
| Time | Cur. | Event | Actual | Forecast | Previous | |||
| Sunday, June 12, 2016 | ||||||||
| 09:30 | CNY | Industrial Production (YoY) (May) | 5.9% | 6.0% | ||||
| Tuesday, June 14, 2016 | ||||||||
| 12:30 | GBP | CPI (YoY) (May) | 0.4% | 0.3% | ||||
| 16:30 | USD | Core Retail Sales (MoM) (May) | 0.4% | 0.8% | ||||
| 16:30 | USD | Retail Sales (MoM) (May) | 0.3% | 1.3% | ||||
| Wednesday, June 15, 2016 | ||||||||
| 12:30 | GBP | Claimant Count Change (May) | -2.4K | |||||
| 16:30 | USD | PPI (MoM) (May) | 0.3% | 0.2% | ||||
| 18:30 | USD | Crude Oil Inventories | -3.226M | |||||
| 22:00 | USD | Fed Interest Rate Decision | 0.50% | 0.50% | ||||
| 22:30 | USD | Fed Chair Yellen Speaks | ||||||
| Thursday, June 16, 2016 | ||||||||
| 02:45 | NZD | GDP (QoQ) (Q1) | 0.9% | |||||
| 05:30 | AUD | Employment Change (May) | 15.0K | 10.8K | ||||
| 07:00 | JPY | BoJ Monetary Policy Statement (YoY) | ||||||
| 10:30 | JPY | BoJ Press Conference | ||||||
| 12:30 | GBP | Retail Sales (MoM) (May) | 0.3% | 1.3% | ||||
| 13:00 | EUR | CPI (YoY) (May) | -0.1% | -0.1% | ||||
| 15:00 | GBP | Interest Rate Decision (Jun) | 0.50% | 0.50% | ||||
| 16:30 | USD | Core CPI (MoM) (May) | 0.2% | 0.2% | ||||
| 16:30 | USD | Philadelphia Fed Manufacturing Index | -1.8 | |||||
| Friday, June 17, 2016 | ||||||||
| 16:30 | USD | Building Permits (May) | 1.150M | 1.130M | ||||
| 16:30 | CAD | Core CPI (MoM) (May) | 0.3% | 0.2% | ||||
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About the Author
Barry Normanauthor
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