Copper Traders Most Bullish in Two Months on Demand Outlook: Commodities

Copper traders are the most bullish since October as global inventories at a two-year low add to signs that demand is improving.

Sixteen of 28 analysts surveyed by Bloomberg expect the metal to advance next week, the first positive outlook in three weeks and the highest proportion since Oct. 14. Global copper stockpiles monitored by exchanges in London, Shanghai and New York fell 22 percent since March and this month were at the lowest level since October 2009, Bloomberg data show.

European copper demand will rebound after this quarter and prices will climb 26 percent in the next 12 months, Goldman Sachs Group Inc. said Dec. 20. The European Central Bank awarded a record 489 billion euros ($638 billion) to euro-area banks for three years on Dec. 21 to keep credit flowing amid a debt crisis that helped wipe more than $10 trillion from the value of equities since May and pushed copper down 21 percent this year.

“Reported inventories have been declining very aggressively, and the indication suggests that the market is still tight,” said Nikos Kavalis, an analyst at Royal Bank of Scotland Group Plc in London. “Copper is going to have decent, if unspectacular, growth rates. Supply is still constrained.”