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Could the People’s Bank of China be about to cut rates?

Copper has made a big bullish move this week and is back to the best levels since May.

You can muster a multitude of reasons, especially on a day when the S&P 500 is up 69 points to 4432. Covid is fading and governments are not cutting back on spending. In the long term, there is massive spending on green energy and that is a direct game on copper.

However, in the short term, the moment remains curious.

One reason could be the PBOC. ANZ released a note this week saying that a 50 basis point cut in the RRR could come as soon as today. Alternatively, we could see a directed MLF.

That’s something to watch out for for copper, Chinese equities, and commodity currencies alongside all global risk trading.

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