Concerns about slowing Chinese growth and domestic bond defaults have weighed on copper. There have been concerns that copper-backed loans in China are expected to unwind. Some 60-80% of China's copper imports have been used as collateral.
Not everyone agrees however. From Goldman Sachs (via FT):
"In contrast to some media reports, we find that the bulk of Chinese
commodity financing deals are ongoing, facilitating ‘hot money’ inflows
into China and providing a mechanism to import low cost foreign
financing." They argue it remains a supply-demand story. With declining
demand in China as supply stays strong.
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