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Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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October 2018 | Base Metals


Copper: Good fundamentals, bad macro


Copper has come under renewed downward pressure since late September, which invites us to question the sustainability of the rebound from mid-August. However, our latest assessment of the copper market continues to suggest that the fundamentals are tightening, thereby leading us to leave our bright outlook for copper prices for Q4 2018 and 2019 unchanged. We expect the rebound in copper prices to continue in the remainder of the year and gain further strength early in 2019.

Week in review – US bond yields raise macro pressures
Copper was under downward pressure for a second straight week last week amid a mixed performance across the base metals and as China was on its Golden Week holidays. The LME copper price closed 1.2% lower at $6,186.5 per tonne as of October 5 while the CME copper price weakened 1.6% to close at $2.759 per pound. While LME open interest was stable, CME open interest dropped by around 5%, suggesting that the price weakness was chiefly the result of long liquidation.

The weak performance in copper was underpinned by a...

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