China’s economy expanded at a moderate pace in the final month of the year, supported by better business sentiment, easing factory inflation pressures and faster car sales. However the slumping property sector and slowing external demand are clouding the outlook for the world’s second-largest economy. To counter the slowdown, the world’s largest consumer of all commodities is likely to add stimulus to stabilize growth next year.
In the latest virus developments, the omicron variant is pushing worldwide COVID-19 cases above 1 million for a second straight day.
“Heading into 2022, the initial focus will be firmly on China, not only how they handle the omicron outbreak but also whether renewed stimulus will offset a slowdown in the property sector,” Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by email. He sees prospects for copper prices breaking out heading into next year.
Copper advanced 1.2 per cent to settle at US$9,680.50 a metric ton at 5:51 p.m. on the London Metal Exchange, the highest since Nov. 25. Other main LME metals were mixed after the bourse reopened following the Christmas break, with aluminum down 0.9 per cent and nickel up 1.7 per cent.
Gold declined for a second day as investors weighed evidence that omicron doesn’t pose a major threat to global economic growth. The yellow metal fell 0.1 per cent to US$1,804.80 an ounce at 3:19 p.m. in New York. Bullion for February delivery slipped 0.3 per cent to settle at US$1,805.80 on the Comex. Spot silver, platinum and palladium all fell.