Base metals are rallying amid an intensifying energy crisis, and heightened inflation fears are reigniting investor enthusiasm, especially for copper, according to a report by ING. Meanwhile, a stronger renminbi may be accentuating broader demand expectations for commodities from China.
Fears of inflation could increase demand for metals as there is a perception that they are a hedge against inflation, which is especially true for copper. In the meantime, a retreat in U.S. real rates, along with the broad trade-weighted dollar index over the last couple of days, is also driving momentum.
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