Copper surges on hopes that demand will improve
The price of copper pushed higher Friday on a bet that it may be one of the first commodities to benefit if the U.S., Europe and China prove successful in building up their economies.
Copper for December delivery rose 12.25 cents, or 3.3 percent, to finish at $3.8325 per pound. The price has increased 12 percent since Aug. 1.
Many investors consider copper a reliable barometer of global economic health because it is used as raw material in a wide range of products, from construction materials and automobiles to consumer products such as cookware.
Authorities in the U.S., Europe and China have approved measures aimed at re-energizing economic growth. Manufacturing has been weak in all three regions while the job markets are anemic in the U.S. and Europe.
The Federal Reserve pledged Thursday to buy billions of dollars of mortgage bonds and to keep interest rates at record lows until mid-2015. Europe's central bank plans to buy unlimited amounts of government bonds to try to resolve the debt crisis. And China is allocating billions of dollars for infrastructure projects.
Copper should be one of the first metals to benefit if manufacturing improves as a result of stronger economic growth, said George Gero, vice president at RBC Global Futures.
"If there is industrial recovery, copper will be one of the first to notice it," he said.
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