Copper prices rose on Thursday as investors' demand for commodities increased to protect investments against inflation.
U.S. copper rose today to the highest level since May 2006.. Analysts saw a rising consumer prices and a falling dollar as growing inflation risks.
Consumer prices rose 0.4 percent in January, a report from the U.S. Labor Department informed yesterday. The dollar fell 0.6 percent today against major currencies including the euro and yen. Specialists said these signs of inflation drove investments to commodities.
U.S. copper futures for May rose $10.30 or 2.77 percent to $3.8220 a pound on the Comex division of the New York Mercantile Exchange. Copper climbed along with precious metals such as gold and platinum which reached record highs.
Inventories of copper monitored on the London Metal Exchange supported prices as they declined 2,250 metric tons or 1.6 percent to 135,375 metric tons on Thursday. The drop represents the lowest since October 10.
Copper has recorded gains recently on increasing demand from China and falling inventories in the LME.
Additionally, the International Copper Study Group (ICSG) said world refined copper consumption exceed production by 149,000 metric tons between January and November 2007, against a surplus of 104,000 metric tons compared to the same period in the year before.
Copper futures in the London Metal Exchange fell $44 or 0.53 percent to $8, 194 a metric ton.