Copper trading volumes rebound

LONDON, Nov 05 (Reuters): Copper volumes on world exchanges are climbing again as a buoyant economic recovery from COVID-19 in top metals consumer China spurred speculators to pile back into the market.

Copper is widely used by speculators and funds as a proxy for the health of the global economy due to its wide range of uses from construction to manufacturing.

Copper trading activity slumped in the immediate aftermath of the coronavirus pandemic as funds and speculators fled from high volatility.

But as stimulus spending in China boosted demand, the price of LME benchmark copper futures CMCU3 soared 61 per cent from its March lows in the early days of the COVID-19 pandemic to a 28-month peak last month of $7,034 a tonne.

Copper has since pared some of the gains, but is still up more than 50 per cent since March and many traders are betting it will resume its rally.

In China, copper volumes on the Shanghai Futures Exchange more than doubled in September after surging by 78 per cent the month earlier. ShFE attracts huge numbers of small retail speculators as well as hedge funds and industrial players.