London 07/27/12 - The industrial metals go into the weekend with gains. After a turbulent week in the markets, which ended with the release of the latest U.S. economic data, the prices are where the last week has ended.
Investors react today to the movement in the euro zone. Yesterday, ECB chief Mario Draghi had announced their intention as part of the mandate of the ECB do whatever is necessary to get the euro. Thus, Draghi has caught harsh criticism of the Bundesbank. However, should the now well below the support rocking EU members Italy and Spain through its bond purchases is an important step to convince market participants. The yields of Italy and Spain have now fallen significantly, while that of Germany attracted. Today also Angela Merkel and French President Francois Hollande in a joint press release have announced that they are determined to "do everything possible to protect the euro zone." Both countries had the integrity of the euro-zone deeply committed.
Such statements are the ones who were waiting for. Although the statements are little more than the mere expression of intention, however, governments have finally committed to the outside to take bigger risks in order to defend the interests of Europe. The threatened downgrade of Germany's top credit rating from Moody's is likely Merkel have facilitated such a move.
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In the real economy of the United States and the structural weakness of the euro crisis has become clear in the second quarter. The economy slowed markedly over from the first quarter, GDP grew by only 1.5 percent annualized. This is likely to prompt the Fed to turn the option of a further round of quantitative easing. This would be the third round of easing, and is aimed at the business make more resources available. The major companies in the U.S. but have cash reserves in the trillions of dollars, so that the step could fizzle out, as banks have struggled in the past to provide greater liquidity to the smaller companies.
In China, meanwhile, in the second half of an expected increase in demand for refined copper by five percent to 3.95 million tonnes. This was announced by the Chinese agency Antaike with today. In the first half of the demand was at 3.75 million tons, so that could be a total demand of 7.7 million tonnes at the end of the year, an increase of five percent over the previous year. The expected increase in demand are likely to include the network builders. These could be ordered in September on a large scale copper for the manufacture of large power cable. The copper price could increase in the coming months, so again noticeable.
Also, aluminum is obviously more interesting again. As RBC Capital announced, could the recent closure of manufacturing plants around the world contribute to a significant reduction in the surplus. Could follow to a recovery in prices for the alloy.
The recovery of the euro against the U.S. dollar today carries on price developments in the commodity markets. The common currency currently costs $ 1.2364.
Copper improves by 1.2 percent to $ 7,562 / ton, aluminum added 1.0 percent gain to $ 1,912 / tonne, lead jumping by 2.4 percent to $ 1,930 / tonne upwards. Slightly positive note nickel, which is 0.3 percent, to recover $ 15,946 / ton. Tin increases by 1.7 percent to $ 18,060 / ton.
