US copper futures hovered just under contract highs at the open Friday, with record lows in the dollar and quarter-end investment buying extending the industrial metal's bull run, analysts said.
"It's all a reflection of the dollar," said Steve Platt, analyst with Archer Financial Services in Chicago. "I think there are some real concerns that we're kind of moving into a 1970's type inflation atmosphere, and those kinds of fears are what's underlying all of these markets."
By 10:33 am EDT (1433 GMT), copper for December delivery was up 1.60 cents at $3.6640 per lb on the New York Mercantile Exchange's Comex division, trading from $3.6410 to $3.6980.
The contract high was set at $3.7020 on July 23. Since the middle of August, the benchmark December contract has rallied over 21 percent. Futures volumes were estimated at modest 2,887 lots by 10:00 am.
Looking ahead, the market will be keeping an eye on developments in Peru where unions at Southern Copper's Cuajone and Toquepala mines in Peru and the Ilo smelter plan to walk off the job on Tuesday, October 2. Southern Copper, a major copper producer, is controlled by Grupo Mexico, whose Cananea copper pit in Mexico has been plagued by a two-month long strike.
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