Until last night the markets had been uncertain about the Federal Reserve’s likely strategy for reducing the current debt-purchasing scheme. We now have more clarity on this, and tomorrow we will also see the first non-farm payrolls report of 2014, which could help give the markets a little more confidence.
The lack of solid information in these two key areas has partially contributed to nervousness which put pressure on the spot price of copper. The bigger picture, in which a number of the larger mining companies are planning on increasing their production in 2014, has also loomed over the markets. However, there is a chance that the ongoing union issues sweeping through Chile and delaying shipping might eventually help squeeze the copper market.
The recent trend in manufacturing figures out of China has also been generally towards weakness. Taking all these factors together, there is every chance that the metal’s price will drift back down into the middle of the range in which it has spent most of the last six months.