U.S. copper futures climbed today as the dollar slumped to a record low against the euro amid a gloomy economy outlook.
Despite of a new plan announced yesterday by the Federal Reserve to lend up to $200 billion to banks, worries about the health of the economy in the second consumer f copper still alive.
On Wednesday the U.S. currency traded as low as $1.5571 according to Reuters the weakest price ever. Later in the day the dollar recovered gains rising to $1.5565 the source reported.
Copper traded in dollars has climbed 26 percent this year due to a strong purchase of commodities as a hedge against inflation, Reuters noted.
Copper futures for May delivery rose $5.15 or 1.36 percent to $3.8370 a pound on the Comex division of the New York Mercantile exchange.
Earlier, the red metal fell 0.9 percent on worries that a weak economy in the U.S. may decrease demand for the metal. The North American country is the second consumer of copper in the world after China.
Yet, concerns on supplies disruptions in Chile prompt investors to forecast greater demand of copper. According to Bloomberg, Codelco reported last week that production in 2007 fell 5.5 percent to 1.583 million tonnes.
In the other hand, supporting high prices today, copper inventories stored on the London Metal Exchange fell by 1,275 metric tons to 128,975 metric tons.
London copper on the London Metal Exchange dropped $41 or 0.49 percent to $8,352 a metric ton on Wednesday.