Traders sold copper on Monday, as Beijing revealed a second-quarter GDP of 7.5%, which compares to 7.7% in the first quarter. The drop is the country’s ninth decline in the past ten quarters.
The economic slowdown in China is no secret, and the price of copper has declined over 7% in the last three months, chiefly because China has recently been a large importer of the red metal and dealers have used the cooling of their economy as an excuse to sell.
According to the COMEX, the exchange where copper futures and options contracts are traded, the number of net short positions on copper futures has declined by 2.5% in early July, which suggests that hedge funds and investment banks are not as bearish on the metal as they once were. Another way to interpret the information is that some dealers are closing out short positions to lock in profit.