Forex Analysis & Reviews: 13.07.2022 - Copper is down 30% from its...

Live Chat

InstaForex - Official partner of Dragon Racing

This section features the most important information about trading with InstaForex. We provide both analysis from leading experts for experienced traders and articles on trading conditions for beginners. Our services will help increase your profit potential.

Become Trader

Account Opening

See also

Trading Conditions

Forex Analytics

Charts

This section is designed for those who are just starting their trading journey. InstaForex educational and analytical materials will meet your training needs. Our experts' recommendations will make your first steps to trading success simple and clear.

Start as Beginner

How to start trading

Useful information

Training and recordings

InstaForex innovative services are an essential element of productive investment. We strive to provide our clients with advanced technical capabilities and make their trading routine comfortable as we are recognized as the best broker in this regard.

Become Investor

PAMM System

ForexCopy System

Passive investments

OYS account

Partnership with InstaForex is beneficial and top-tier. Join our affiliate programs and enjoy bonuses, partner rewards, and the possibility to travel with the team of the world-renowned brand.

Become Partner

Main Page

Partner Area

Advantages for Affiliates

Registration

This section contains the most lucrative offers from InstaForex. Receive bonuses when topping up an account, compete with other traders, and get real prizes even when trading in a demo account.

All Promo Campaigns

Bonuses

Contests

Events

Holidays with InstaForex are not only pleasant but also useful. We offer a one-stop portal, numerous forums, and corporate blogs, where traders can exchange experiences and become successfully integrated into the Forex community.

Full details

Forums

We are in social networks

Forex humour

Forex Portal

InstaForex is an international brand created in 2007. The company provides services for online FX trading and is recognized as one of the world's leading brokers. We have won the trust of more than 7,000,000 retail traders, who have already appreciated our reliability and focus on innovations.

Learn More

History

Why Choose Us

InstaSport

Regulation

Company News

Awards

InstaForex Stars

InstaForex Offline

Headquarters

Key documents

Social Responsibility

InstaForex Loprais Team - Official participant of the Dakar rally

13.07.2022 01:12 PM

Copper is down 30% from its March record

Copper lost one of its most powerful backers after Goldman Sachs cut its short-term price forecasts in anticipation of a sharp decline in consumer spending and industrial activity amid deepening energy crises in the Euro area.

Analysts at Goldman Sachs were among the most bullish supporters on commodities, and said copper could become one of the tightest markets ever seen. But with investors selling the metal en masse and prices currently 40% below the bank's expectations, it recently warned that the downturn could continue.

Growing dollar demand has put significant pressure on copper, along with the global energy crisis. Even the Bank of America shifted its forecast to $6,700 a tonne in the next three months, compared to the previous $8,650.

From a technical point of view, copper has reached the support level located around $7,000.

Summing this all up, copper has fallen nearly 30% from its March record. Although analysts favored the metal due to limited supplies and its use in fast-growing green technologies, prices have fallen as cuts in energy supplies undermine the economy, especially in Europe.

As mentioned earlier, the Bank of America cut its forecasts last week, warning that in a worst-case scenario where Europe faces widespread gas shortages, prices could fall as low as $4,500 a tonne.

On the London Metal Exchange on Tuesday, copper fell 3% to $7,354 a ton, its lowest close since November 2020. Other base metals decreased as well.

Marcus Garvey, head of commodities strategy at Macquarie Group said the copper market may run into a surplus in the next two years if demand declines and production continues to expand. He added that if there are no new supply shocks, the performance of the metal will depend on global growth.

"The downward spiral in copper price that has gathered momentum in recent sessions reflects increasingly pessimistic growth expectations," Goldman Sachs said. "This latest leg lower has been tied to increasing headwinds to European growth path, in particular from the impact of surging regional natural gas prices on activity," they added.

Goldman Sachs also warned that lower prices may encourage manufacturers to curtail supplies, but those would be needed only during a global recession. Nevertheless, the bank said copper is on track to hit $15,000 in 2025, citing clear structural gains as mine supply peaks. It is expected to cost $7,600 in six months and $9,000 in 12 months, compared to previous forecasts of $10,500 and $12,000.

You have already liked this post today

*Disclaimer: The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.