Is Copper a Precious Metal Now?

Source:

". . .analysts believe copper could play an increasingly significant role in helping mining companies boost production."

Has copper become a precious metal now? That is the question investors are asking now. In fact, many investors have now started dumping gold for copper so that they can make a killing in the unprecedented surge the orange metal is witnessing.

Copper price staged a stunning turnaround earlier this year, long before economic recovery appeared on the horizon.

From a low of about $1.25 per pound last fall, the price of the metal used to make wires and pipe has recently traded at close to $3 a pound. In fact, copper is acting like a precious metal.

Some investors are treating it more like silver, platinum or gold, buying it as a hedge against currency fluctuations, potential inflation or even as a store of long-term value.

According to analysts, there are elements in the market that want to hold copper as a hedge very much like they would keep gold.

Some analysts believe that copper could play an increasingly significant role in helping several mining companies boost their production.

The longer-term trading of copper will be based more on fundamentals of supply and demand. But there is a currency component to the point that people having a negative view on the value of currencies believe one way to hedge, somewhat, is to buy commodities. So copper is benefiting from that.

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