Looking at the development and changes of the main macro factors supporting the rise of copper prices in the early stage, this paper tries to make a further perspective.
1, the State Reserve collects copper.
The benefits of collecting copper from the State Reserve may have gone far from the original intention of the policy and become the subject of market speculation. The actual amount of copper collected and stored by the State Reserve is unknown, but according to conventional judgment, the State Reserve will gradually purchase in batches, because there are two major disadvantages in short-term acquisition: First, it may cause excessive government intervention to affect the market, and the resulting sharp price increase will greatly increase the reserve cost. Observing the crude oil that both China and the United States took storage measures after the outbreak of the crisis last year, whether from last year's low point or from 2009, its increase was far less than that of copper. The soaring copper price will greatly increase the possibility that the country will slow down the pace of purchasing and storing.
2. Recovery of macroeconomic data.
China's recent economic data shows signs of economic rebound, but it cannot be asserted that the economy continues to reverse. For China's current economy, maintaining growth is mainly to make up for the decline in exports with greater investment. The most eye-catching data in the first quarter is investment: the investment in fixed assets of the whole society increased by 28.8% year-on-year on the basis of continuous high-speed growth for many years, and the new loans of financial institutions reached a single-quarter high of 4.58 trillion yuan, mainly driven by government investment. However, it remains to be seen whether government investment can stimulate private investment. From a global perspective, although the economic stimulus plans adopted by various countries have achieved initial results, it still takes a long time for economic recovery.
3. Mobility in China.
Abundant liquidity does not necessarily mean economic recovery, nor is it the internal cause of rising asset prices. Although there will be a "not bad money" market, the market will eventually return to the fundamentals of the real economy. The surge of bank credit data implies problems such as unbalanced loan structure, hidden concerns about loan quality and loan expansion. The role of new loans in promoting the economy needs further investigation.
4. Inflation expectations.
In order to stimulate the economy and employment, many governments have implemented unconventional policies and measures, such as the quantitative easing monetary policies of the United States, Japan and Britain, and the explosive credit growth of the Bank of China (60 1988), which has led to rising inflation worries. Driven by the preservation of commodity investment, copper is highly sought after. Judging from the CPI and PPI data of various countries, China and the world have not changed the trend of deflation, and the risk of a large increase in money supply pushing up inflation in the short term is not high, and the possibility of hyperinflation in 2009 is small; At the same time, global deflation expectations have been greatly reduced.
5. the trend of the dollar.
On March 18, the Federal Reserve announced that it would purchase long-term treasury bonds, related mortgage-backed securities and mortgage agency bonds, totaling $65,438 +0. 15 trillion. The market believes that the United States began to print money to save the market, and the US dollar index fell by more than 4% in two days, and then quickly rebounded and stabilized. On April 16, ECB officials said that the central bank would launch non-traditional financing measures in early May. The market believes that this implies that the European Central Bank will adopt quantitative easing monetary policy, and the US dollar index will rise by about 2%. Macroeconomic data show that the US economy is better than other countries and regions where the world's major currencies belong, and it is still difficult to shake the status of the US dollar. From the mid-term perspective as of the end of 2009, it is more likely that the expectation of dollar depreciation will fail, and maintaining a strong dollar is not conducive to the rise of copper prices.
6. Industrial production.
As an important basic metal variety in the world, copper used to be a "barometer" to measure global manufacturing activities. Although this round of copper surge has declined, it is still at a high level, which is quite different from the global manufacturing situation: the manufacturing industry is in recession, and it is likely to fall into the worst situation since the1930s. The future of China's industrial production is still unclear, and it is still too early to say. On April 20th, the China Electric Power Enterprise Association said that the electricity consumption in April is expected to be lower than that in March, and it is still fluctuating at the bottom. And electricity consumption is one of the most important indicators reflecting the industrial production situation.
7. Endurance of "China Factor".
As the most dazzling "star" in the commodity market this year, the rising power of copper is attributed to the "China factor". There are two questions: first, even if China can survive the global economic recession, can China's demand for copper make up for the sharp decline in the world (CRU data predicts that the global demand for copper will decline this year 15%-20%). Second, who will pay the biggest price for the soaring copper price? It is undoubtedly the largest importer of copper resources in the world-China.
8. Discussion on the causes of dislocation between copper demand and copper consumption.
This round of copper market is greatly affected by the shortage of spot supply, and spot prices have a significant impact on futures prices. What is puzzling is that CRU statistics show that in the first quarter of this year, global copper production exceeded copper consumption by 557,000 tons. This phenomenon can be explained by hoarding goods without demand. However, due to the small possibility of the collapse of major international currencies and RMB, the accumulated copper will eventually be transferred to final consumption, thus affecting its supply and demand fundamentals.
The macro factors affecting the afternoon copper price will gradually change.
The continuous correction of copper prices after the recent continuous surge lacks the support of fundamental factors, and it is difficult to analyze it from the perspective of supply and demand. This round of market takes advantage of the peak consumption season, exaggerating the reserve's purchasing and storage of copper under the condition of high liquidity, as well as the expectation of economic recovery and rising inflation. Macro factors have become the most important driving force for the trend of copper prices. The author predicts that the short-term trend of copper futures will intensify and the overall trend will be empty; At present, the differences between the long and short sides have increased, the peak consumption season has not yet ended, and the spot is still firm. However, the previous surge in copper prices has overdrawn all the original favorable factors, and we will continue to pay close attention to the funds and policies. Copper futures are bearish in the medium term. With the end of the peak consumption season, the support of spot prices for futures prices will be unsustainable, and it remains to be seen when the global economy will recover. With the gradual stabilization of the real economy and people's psychology after the financial crisis, the influence of copper fundamentals is expected to increase, and the dominant factor of copper price will turn to the fundamentals of whether demand continues to grow.