Red metal inches up again

Falling dollar imparts shine to red metal

Copper prices rose at Comex for third straight day on Monday, 14 December, 2009. Prices rose as the dollar fell as news hit the wires that Abu Dhabi has committed to bail out Dubai out of its debt crisis.

At USA, copper futures for March delivery ended higher by 2 cents (0.6%) to 3.13 a pound. Last week, copper ended lower by 3.1%. Copper ended November 2009 higher by 6.6%. On a year to date basis, copper has climbed 116.6%.

On the London Metal Exchange, copper for delivery in three months ended higher by $12 (0.2%) at $6,912 a metric ton. On 3 July, 2008, prices had touched an all time intra day high of $8,940.

In the currency market on Monday, the dollar index, which weighs the strength of dollar against a basket of six other currencies fell by almost 0.3%.

The U.S. buys about 13% of the 17 million metric tons of copper sold annually and China buys about 20%.

In FY 2008, copper prices dropped by 54%. Prior to 2008, copper prices ended FY 2007 with a gain of mere 5.5% after a whopping 44% gain in FY 2006. The price of copper gained every year since 2002 as global economic growth boosted demand for the metal used in pipes and wires.

At the MCX, copper for February delivery closed at Rs 324.7/Kg. The closing price was Rs 0.85/Kg (0.3%) higher than previous closing price. Prices rose to a high of Rs 326/ Kg and fell to a low of Rs 322.2/Kg during the day's trading.

Among other metals traded in the LME on Monday, lead lost 0.3% to $2,322 a ton and zinc lost 0.5% to end at $2,318 a ton. Nickel added 0.7% to $16,750. Aluminium gained 1.8% at $2,284 a ton.