London copper prices crept forward for a third straight session on Thursday as China’s move to inject liquidity into the financial system boosted expectations of higher demand in the world’s top industrial metals consumer.
The People’s Bank of China is injecting 250 billion yuan ($37 billion) through seven-day reverse bond repurchase agreements and 150 billion yuan through 28-day reverse repos, traders said.
Shanghai copper has flipped into backwardation amid a promise of value-added tax (VAT) cuts in China, which has increased near-term demand for physical copper, brokerage Jinrui Futures said in a note.
The tax reductions are not expected to be formalised until March but Jinrui Futures said their implementation could result in a 400 yuan a tonne boost to the ShFE copper price for every percentage point VAT decrease.
Prices at the close showed a 10 yuan a tonne backwardation between the March and April ShFE copper contracts and a 120 yuan a tonne backwardation from April to May.
Georgian Mining Corporation (LON:GEO), the AIM listed copper-gold exploration and development company, today announced that the Georgian Government Resolution on the Company’s pending exploration permit was included in a cabinet meeting at the end of December 2018, immediately before the Government went to recess for the festive season.