Copper prices have soared almost 20% since Donald Trump was elected president. Copper is said to have PhD in economics because it has applications in a range of industries. Everything from the construction and automotive industries to electronics. Copper prices tend to move with the business cycle.
Copper prices didn’t just start rising after Trump was elected. They started rising well ahead of the election and they have been up for 14 consecutive days.
Did copper see a Trump victory when few others did? Maybe, but a new plan from China that calls for additional spending on building and construction projects is likely the driver here. The WSJ has more of the details.
China has been responsible for much of the rally, analysts say. The government’s new plan calls for additional spending on building and construction projects, and an official gauge of factory activity in China rose last month to its highest level in two years. The U.S. also posted signs of increased manufacturing activity in October.
Metals got another boost this week by the victory of Donald Trump, who has indicated plans to spend hundreds of billions of dollars on infrastructure. In his victory speech, the U.S. president-elect re-emphasized his plan for widespread construction. “We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals,” he said on Wednesday.
Fiona Boal, director at Fulcrum Asset Management in London, said Mr. Trump’s election as president is adding one more bullish factor to copper, “the trade du jour.”