Metals Prices Surge as China Cuts Interest Rates to Boost Property Market | Copper & Zinc Rise
Industrial metals, including copper and zinc, saw price increases after Chinese banks cut interest rates to support the property market. Learn how China’s economic measures are impacting global metal prices
The prices of industrial metals, such as copper and zinc, increased after Chinese banks lowered their lending rates. This decision is part of China’s plan to help its economy meet growth targets for the year. The rate cuts were larger than expected, and they follow similar steps taken by China’s central bank in September. China's government has been pushing for lower interest rates and stronger actions to support the struggling property market, which is a major buyer of metals like steel, copper, and zinc.
In recent weeks, metal prices have been unpredictable. Investors have been reacting to a series of announcements by China’s government about how they plan to support the economy and meet a 5% growth target for the year. While metals like iron ore and copper initially rose when Beijing introduced these measures, doubts about their long-term effectiveness caused prices to ease.
By 11:57 a.m. local time on the London Metal Exchange, copper was up 0.8% to $9,700.50 per ton, while zinc climbed by 1%, and aluminum saw a small increase of 0.3%. Meanwhile, iron ore—a key material for making steel—rose by 1.7% to $103.45 per ton on the Singapore Exchange, but later settled at $101.90.
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Why It Matters:
China's property market has been facing challenges, and this has impacted global metal prices. As one of the largest consumers of metals, any changes in China's economy affect the global market. The government’s recent efforts, including cutting rates, are aimed at boosting the property sector, which uses a lot of metal for construction.
At the same time, demand for metals like copper is also growing due to the global shift towards green energy. Copper is widely used in electric vehicles and renewable energy systems, making it even more important in the long run. However, for now, the metals market remains uncertain, with global economic concerns like inflation and slowing demand also influencing prices.
Many investors are waiting to see if China’s actions will help stabilize the metals market in the months ahead. As China is a key player in the global metals market, its economic health will continue to shape metal prices worldwide.
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