Copper futures rallied on Monday as the dollar fell rising demand of the red metal as a hedge against inflation and a strong earthquake in China made investors speculate whether production may be affected.
Today the dollar fell 0.4 percent against six major currencies including the euro and yen. At the closing of copper market the euro was trading up to $1.5545 from $1.5481 late Friday.
Demand for copper increases on a weakening dollar because the metal is bought to compensate for inflation and it is cheaper for investors who buy with foreign currencies.
Copper futures for July delivery climbed 3.30 cents or 0.89 percent to $3.7495 a pound on the New York Mercantile Exchange Comex division on Monday.
Supporting the increase today, an earthquake of 7.8 grades of magnitude hit Sichuan province at the southwestern region of China killing close to 9,000 people so far, according to media reports.
The earthquake is the worst over 30 years in China and Sichuan province is located next to Yunnan province a region known for hosting some of China's biggest copper and aluminum smelters. The market will monitor any major damage to the mining sector.
In Peru, miners suspended a potential strike scheduled to begin today as Peru Mining Federation said it will give time to the government to pass legislation that would benefit miners with better share of profits, greater rights and higher pensions.
Inventories of copper stored in the London Metal Exchange rose 375 metric tons to 121,650 metric tons on Monday.
Copper futures for three months delivery fell $201.5 or 2.40 percent to $8,199 a pound on the London ICE Futures Exchange on Monday.