BLBG: Copper Jumps on Speculation Government Spending to Boost Demand
Copper jumped for the third time in four sessions on renewed speculation that government spending on roads, bridges and other infrastructure projects will boost demand for the metal used in pipes and wires.
Heeding President Barack Obama’s appeals, the U.S. House is set to pass a stimulus plan to pump more than $800 billion into the economy to wrest it from recession. Before today, copper climbed 5.3 percent in January, heading for the first monthly gain since June, on speculation demand will rise.
“The biggest component copper is going to benefit from is the U.S. stimulus spending on infrastructure projects, which will go directly to copper demand,” said Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago. “We could see increased demand over the next three to six months.”
Copper futures for March delivery gained 4.25 cents, or 2.9 percent, to $1.528 a pound at 9:23 a.m. on the New York Mercantile Exchange’s Comex division. The price has risen more than 9 percent since Jan. 22.
On the London Metal Exchange, copper for delivery in three months added $70, or 2.1 percent, to $3,380 a metric ton ($1.53 a pound). The price reached a record $8,940 on July 2.
