Copper, gold to rise further on demand outlook, macro uncertainties, Antaike says

Copper, gold and other metals that have notched strong gains this year will rise further fuelled by robust Chinese demand outlook and macro uncertainties, Chinese state-backed research house Antaike said.

Metals with firm fundamentals and good liquidity have become more appealing to global financial investors amid receding U.S. interest rate cut bets, the conflict in the Middle East, and the war in Ukraine.

Copper prices, often used as an economic bellwhether, were also underpinned by concerns of output cuts due to shortage of raw material and demand optimism fuelled by the green energy transition.

The London Metal Exchange's (LME) benchmark three-month copper contract climbed to a two-year high of $9,843 per metric ton on Friday by 0505 GMT, up 14% so far this year.

The most-traded copper contract on the Shanghai Futures Exchange (SHFE) hit a record 79,840 yuan ($11,025.80) a ton earlier on Friday and was up 14% year-to-date.

Copper is likely to gain further, driven by large capital inflows which will likely last until the U.S. cuts its interest rates, Antaike said in its report published late on Thursday.

The first quarter saw growing copper demand chiefly from the new energy sector, including electric vehicles and wind power, as well as the information technology sector like AI-related electric equipments and data centres.

GOLD

Antaike expects global gold prices to remain supported by growing investor appetite and rising production costs.

Spot gold rose 0.2% to $2,383.79 per ounce at 0504 GMT, hovering near an all-time high of $2,431.29 hit on April 12.

The research house expects the uptrend to last in the mid-to-long term, reaching as high as $2,700 per ounce.

TIN

Demand for tin from electronics consumers in China recovered, with consumption from solar, white goods and automobiles higher than expectations, Antaike said.

Supply headwinds, with production from major tin producer Myanmar yet to resume and a slowdown in Indonesia's tin mining boosted prices of the metal used in soldering.

Shanghai tin is likely to range between 240,000 yuan and 275,000 yuan a ton during the second quarter, while LME tin could range between $31,000 and $35,000 a ton in the same period, it said.

Antaike analysts also eyed gains in aluminium and silver prices, but said they expect a lack of strong demand to pressure lead and zinc prices.