Copper futures rose to a three-week high after China’s central bank cut an interest rate for the second time in a month, fueling speculation that lower borrowing costs will spur economic growth and demand.
The bank sold 14-day repurchase agreements at 3.4 percent today, compared with 3.5 percent on Oct. 9. Copper has dropped 9 percent this year on signs of a slowdown in China, which according to Standard Chartered Plc accounts for 45 percent of world demand. The nation’s growth last quarter probably eased to a five-year low of 7.2 percent, a Bloomberg survey of economists showed before data due Oct. 21.
“The interest rate change provides a little bit of comfort around China, where we haven’t seen positive news,” Vicky Sanders, head of analytics sales at Marex Spectron Group in London, said in a telephone interview. Copper futures for December delivery added 1.6 percent to settle at $3.09 a pound at 1:12 p.m. on the Comex in New York after reaching $3.1045, the highest since Sept. 19.