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Industrial and Base Metals Fundamental Analysis – August 25, 2015 –Forecast – Copper, Palladium & More

By:
Barry Norman
Published: Aug 24, 2015, 13:19 UTC

Analysis and Recommendations: Copper ran red today along with the global markets as traders moved to risk off mode after the fall in Wall Street sent

Industrial and Base Metals Fundamental Analysis – August 25, 2015 –Forecast – Copper, Palladium & More

Metal Monday Bns
Analysis and Recommendations:

Copper ran red today along with the global markets as traders moved to risk off mode after the fall in Wall Street sent traders to the hills. Copper fell 83 points to 2.220. Palladium followed suit giving up $39.70 to 568.90. Copper and aluminium futures lost more ground on Monday with both markets dropping to the lowest levels since 2009 on concerns over slowing economic growth in China, the world’s top consumer of industrial metals

Copper continues to slide losses extending for seven straight weeks, suggesting sentiment towards the red metal is nothing but pessimistic.

Analyst at Bloomberg Research, Kenneth Hoffman, explained the situation to Mining.com when he returned from a tour of China to find out the true state of copper demand in the country.

Commodity prices have been under heavy pressure this year. Among them, Copper prices have plunged more than 19% as concerns over a slowdown in the world’s second-largest economy are growing. A slump in the Chinese economy could drag the world economy into chaos.

Hoffman has been traveling to China for the last 20 years, but what was witnessed in 2015 was dramatically different from the past.

“When I went in April there was a decided change in the mood. On this last trip I was really surprised how negative sentiment has become. I was often asked: ‘What is a bullish thing you could say?’ Everyone was just so bearish and concerned about what was going to happen,” he said.

Hoffman argued that the second-largest economy is shifting toward the service industry. This transition in fact could take a long time and may even have some painful consequences.

“This strategy has been firmly in place for five years – and you’ve seen copper go from $10,000 to $5,000 over this time,” he said. “I asked many analysts and traders in China how long can the downturns last? And it ranged from three years to ten years.”

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.

Today’s economic releases:

Cur.

 

Event

Actual

Forecast

Previous

 

  USD

 

FOMC Member Lockhart Speaks 

 

 

 

   

 

copper

Upcoming Economic Events that you should be monitoring:

Tuesday, August 25, 2015

Cur.

 

Event

Actual

Forecast

Previous

 

  EUR

 

German GDP (QoQ) (Q2)

 

0.4%

0.4%

 

 

  EUR

 

German GDP (YoY) (Q2)

 

1.6%

1.6%

 

 

  CHF

 

Employment Level (Q2)

 

 

4.225M

 

 

  EUR

 

German Business Expectations (Aug)

 

102.0

102.4

 

 

  EUR

 

German Current Assessment (Aug)

 

113.9

113.9

 

 

  EUR

 

German Ifo Business Climate Index

 

107.8

108.0

 

 

  USD

 

S&P/CS HPI Composite – 20 n.s.a.

 

5.1%

4.9%

 

 

  USD

 

Services PMI (Aug)

 

56.0

 

 

 

  USD

 

CB Consumer Confidence (Aug)

 

93.3

90.9

 

 

  USD

 

New Home Sales (MoM) (Jul)

 

6.0%

-6.8%

 

 

  USD

 

New Home Sales (Jul)

 

510K

482K

   

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