Copper Prices Rise as Inflation Fears Mount

The price of London copper rose on Monday as investors continued to look for a hedge against inflation, which shows no sign of cooling down.

The three-month copper price on the London Metal Exchange (LME) climbed 0.4% to $9,899.5 a ton. According to recent market data, Shanghai Futures Exchange-monitored copper warehouses saw significant inflows of up to 164%. 

Oil prices have had a role to play in copper’s rise, with Brent crude reaching its highest level in over seven years, as tensions surrounding Russia’s possible invasion of Ukraine continue to swirl.

The high oil price was responsible for at least some safe-haven investors looking to invest in another dependable commodity, in the form of copper.

What does this mean for me? 

Copper prices often act as a bellwether for the health of the global economy, as investors seek to place their bets on low-risk commodities.

Oil and gold are also considered to represent safe investments when inflation is high. With the former commodity currently outpricing many investors, copper and gold are seeing upticks in interest.

Inflation continues to cause uncertainty in the global market as it has not cooled down to any significant effect in any of the key economic regions.

It helps commodities traders to know which of the asset types in your basket are likely to appreciate in times of high inflation and general instability. With oil prices temporarily pricing many investors out of the market, gold, and now copper, are safe bets.