Record copper prices fueled by huge demand from China, Bloomberg reports

During the Asian trading session, London Metal Exchange copper prices jumped more than 5% in under an hour, marking the largest intraday gain since 2009.

The price of copper reached record levels, surpassing $14,400 per ton, and has risen roughly 25% since early December. Analysts attribute the surge primarily to speculative trading, largely driven by Chinese capital.

"Chinese investors are piling into metals as they ride a powerful wave of momentum that has lifted everything from tin to silver to record highs," the outlet reports.

The sharp increase occurred despite signs of weak physical demand in China, which consumes about half of the world’s copper, and in the presence of ample supplies. Meanwhile, trading volumes on the Shanghai Futures Exchange hit record levels.

Additional market support came from the decline of the US dollar, expectations of a loosening of Federal Reserve monetary policy, and increased investor interest in commodities amid growth in artificial intelligence, energy, and geopolitical tensions.

Experts warn, however, that the rapid price rise may be outpacing real demand, and a market correction could occur soon.

Meanwhile, gold prices continue to rise rapidly and have once again reached a historic high in recent times, surpassing $5,400 per troy ounce.

On January 28, gold was trading at just over $5,200 per ounce. The rise continues amid a weaker US dollar and a shift of investors away from sovereign bonds and currencies, as more capital flows into precious metals.