Copper climbs

A weak dollar buoyed industrial metals on Thursday, with copper rising more than 2 percent after the US Federal Reserve left interest rates steady and dampened expectations of further monetary tightening.
Metal prices have recently been hostage to euro/dollar movements, due to little fundamental news and lack of demand from China, the world's biggest consumer.
Copper for three-months delivery on the London Metal Exchange rose as high as $8,490 per tonne, its highest since May 7, and ended the official session at $8,445 per tonne, up $145 from Wednesday. Zinc traded up more than 5 percent to $2,000 per tonne, its highest since June 3, before closing at $1,990, up $115.
"The dollar is certainly a very powerful force across a range of commodities," ABN Amro analyst Nick Moore said. Gold in particular reacted sharply to the US currency's fall, jumping more than 3 percent. A weaker dollar gives holders of other currencies greater purchasing power over metals which are priced in dollars.
Several analysts say copper has held up well - currently trading only at a 5 percent discount from its all-time peak of $8,880 per tonne - and could well test new highs.
"Copper prices look likely to surge ahead again," said John Meyer, head of resources at Fairfax. "Strong construction growth in Eastern Europe, India and China continues to generate demand for cables, piping and other copper intensive products."
The US economy grew at an upwardly revised 1.0 percent annual rate in the first three months of 2008, helped by stronger consumer spending and exports, a Commerce Department report showed on Thursday. May existing home sales figures rose by 2 percent, according to figures from the National Association of Realtors.
Aluminium closed the session $42 higher at $3,100 per tonne, after gaining more than 10 percent in June and hitting a three-month high of $3,169 earlier this week.
Power problems in various parts of the world and announcements of supply problems pushed the energy intensive metal to recent highs. But analysts said high stock levels and rising production could see aluminium's bull-run unwind.
"The aluminium market is in large surplus at the moment, there's metal everywhere," said analyst Adam Rowley at Macquarie Bank. LME aluminium stocks rose 8,500 tonnes to 1.09 million tonnes - enough for 10 days of world consumption. Nickel closed up $100 at $21,800 per tonne. Lead was $33 higher at $1,815 per tonne. Tin rose $445 to a final quote of $23,150/23,200 per tonne.