AI Optimism Becomes Copper's Primary Price Driver, Goldman Sachs Says
According to a Goldman Sachs analysis, expectations surrounding the AI boom have overtaken traditional factors like China's growth and the US dollar as the primary driver of copper prices since early 2025. While data centers currently account for only 1% of global copper demand, investors are pricing in massive future infrastructure needs, including data centers, power grids, transformers, and transmission lines. Big Tech firms (Microsoft, Meta, Amazon, Alphabet) have pledged hundreds of billions for AI infrastructure, while the US faces a potential 100-gigawatt electricity generation shortfall by 2030. Physical copper markets are also tightening due to low Chinese inventories, scrap regulation enforcement, smelter maintenance, and potential US tariffs. The article notes that traditional demand drivers like China's construction sector remain significant but are now secondary to AI-related expectations.
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