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Copper Prices Rise to 11-Month High on Global Economic Outlook
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By Anna Stablum and Millie Munshi

Aug. 24 (Bloomberg) -- Copper rose, closing at the highest price in 11 months, as comments by the world’s biggest central banks signaled optimism for a recovery by the global economy.

Federal Reserve Chairman Ben S. Bernanke and European Central Bank President Jean-Claude Trichet, speaking at a symposium in Jackson Hole, Wyoming, said the world economy is pulling out of the recession. Stocks rallied around the world for a fifth straight session.

“There’s been a bout of optimism about the economic recovery that’s been driving prices,” said Gijsbert Groenewegen, a partner at Gold Arrow Capital Management. “There’s so much momentum in the market now that it will continue to push prices higher in the short term.”

Copper futures for December delivery gained 3.65 cents, or 1.3 percent, to $2.9305 a pound on the Comex division of the New York Mercantile Exchange, the highest settlement since Sept. 26. Earlier, the metal reached $2.9365, the highest intraday price for a most-active contract since Aug. 14.

On the London Metal Exchange, copper prices for delivery in three months gained $155, or 2.5 percent, to $6,425 a metric ton ($2.91 a pound), the highest settlement since Sept. 26. Earlier, the price reached $6,433, the highest since Aug. 14.

Copper prices have doubled this year on speculation that a rebounding economy will boost demand for the metal used in cars, homes and appliances.

“We had nothing negative out of Jackson Hole, and that would imply they are all in general agreement that the worst is over,” said Alex Heath, the head of industrial-metals trading at RBC Capital Markets in London. “The market has taken into its head we are going to see a recovery in the fourth quarter.”

China’s Imports

Imports of refined copper by China, the world’s biggest metal user, more than doubled in the first half. Shipments dropped by 23 percent in July from a record the previous month, the Beijing-based customs office said today, citing revised final data.

“Any negative economic news, especially from China, could be a huge disappointment to the market,” Groenewegen of Gold Arrow said. “Copper has rallied so much this year that now it’s vulnerable to a correction.”

On the LME, lead closed at $2,025 a ton, the highest settlement since Aug. 28, 2008. Today, the metal jumped 8.7 percent, the most since March 4. The price has doubled this year.

The rally was triggered by a report that Henan, China’s largest lead-refining province, which accounts for about 30 percent of the nation’s production, has shut as much as 240,000 tons of annual smelting capacity, Leon Westgate, an analyst at Standard Bank Group Ltd. in London, said in a report.

Nickel, tin and zinc prices rose in London, while aluminum was little changed.