Copper prices neared the $8,000 mark this morning as the weak dollar made the red metal the pick of the commodities market for traders.
As of 6am, three-month copper was trading up 0.9 per cent at $7,933.50 a tonne on the London Metal Exchange (LME).
The commodity, a useful barometer for economic health, briefly touched $8,000 last month, but quickly slipped back.
The combination of a lower dollar, optimism over vaccines, and hopes of a new economic stimulus package in the US have helped the rally.
A cheaper greenback helps commodities because it makes metals priced against it cheaper for those who trade in other securities.
Analysts said that the metal could push higher again if the Georgia Senate run-off race breaks the way of the Democratic Party.
If both Democrats win, the balance of the Senate will be tilted towards President Joe Biden’s party, with VP Kamala Harris able to wield the crucial deciding vote.
“We are only $70 away so yes we can be at $8,000 soon. It’s all about more money. If Democrats get Senate tonight, I guess we will move even higher,” said commodities broker Anna Stablum of Marex Spectron.
More broadly, copper is an essential component of electric wiring, which is expected to be in high demand as the world accelerates towards net zero fuel sources.