Gold prices scaled historic heights above 1,150 dollars per ounce this week, buoyed by the weak greenback and recent central bank purchases of the precious metal, analysts said. Traders said the dollar's overall weak tone was due to the prospect of US interest rates remaining close to zero for some time yet.
PRECIOUS METALS: Gold hit an all-time peak at 1,152.85 dollars an ounce on Wednesday, extending this year's record-breaking run. "The price of gold moved further north as the dollar's decline continued," said analyst Marius Paun at ODL Markets. "Whilst the US Federal Reserve continues to reiterate that interest rates will remain low, investors appear willing to buy in the precious metal."
A weak greenback makes dollar-priced assets such as gold cheaper for buyers using stronger currencies, and tends to stimulate demand for them. "Like all risk assets, (gold) is benefiting from the sliding dollar, but it is also a safe haven for investors who are concerned about the safety of other currencies," added David Morrison at spread-betting firm GFT.
"We are also seeing (gold prices) rise as central banks become net buyers, after being net sellers for more than 20 years," he told AFP. "China and Russia have added to their holdings, and could easily increase them again. Meanwhile, India and Mauritius have just bought gold from the International Monetary Fund." By late Friday on the London Bullion Market, gold rose to 1,140 dollars an ounce from 1,104 dollars a week earlier.
Silver gained to 18.18 dollars an ounce from 17.32 dollars. On the London Platinum and Palladium Market, platinum advanced to 1,435 dollars an ounce at the late fixing on Friday from 1,359 dollars the previous week. Palladium climbed to 360 dollars an ounce from 354 dollars.
OIL: Oil prices rose in a week of volatile trade. Analysts on Friday said crude futures were likely to stay under 80 dollars because of high oil inventories in the United States, the world's biggest energy-consuming nation, analysts said. "Relatively swollen US stockpiles (are) still weighing," said VTB Capital commodities analyst Andrey Kryuchenkov in London.
New York crude prices on Wednesday breached 80 dollars a barrel after government data showed crude reserves in the United States fell 900,000 barrels in the week ending November 13. However levels remain relatively high with demand struggling to recover following the financial crisis.
Oil prices slumped on Thursday as the dollar rose and owing to renewed doubts about a sustainable global economic recovery, traders said. An array of largely unimpressive US economic data caused a fall on Wall Street as investors sought safety in the dollar, a traditional safe haven currency in times of distress. Oil under 78 dollars a barrel was "a buying opportunity," said analyst Victor Shum at the Purvin and Gertz energy consultancy in Singapore.
"The oil market has shown resistance against breaking through the 80-dollar level simply because the sustainability of economic recovery." They were also struggling to find support owing to strong supplies and weak demand, he added. Crude oil prices soared by 2.50 dollars on Monday owing to a weak dollar and data showing that the Japanese economy expanded 1.2 percent in the July-September period, traders said. It was the second straight quarter of expansion in the world's second-largest economy.
Meanwhile, Opec president Jose Maria Botelho de Vasconcelos has signalled that 75-80 dollar oil is an adequate level to allow for a global economic recovery. The Organisation of Petroleum Exporting Countries (Opec) pumps about 40 percent of the world's oil. Also this week, traders followed events in oil-exporter Nigeria, where its main armed group has accused the military of staging a dawn raid on a village in the restive crude-producing region, saying it could threaten peace talks.
By Friday on the New York Mercantile Exchange (NYMEX), light sweet crude for delivery in December firmed to 76.71 dollars from 76.41 dollars a week earlier. On London's InterContinental Exchange (ICE), Brent North Sea crude for January delivery advanced to 77.03 dollars, compared with 75.65 dollars for the December contract last week.
BASE METALS: Base metals prices rose across the board. "Base metals saw more gains... still rallying amid upbeat sentiment and hopes for a pronounced demand recovery next year," said Kryuchenkov at VTB Capital. "Further weakness in the greenback and buoyant equity markets could still drive metals higher, especially as volatility spikes at the end of the month." By Friday on the London Metal Exchange, copper for delivery in three months rose to 6,804 dollars a tonne from 6,492 dollars a week earlier.
-- Three-month aluminium firmed to 2,004 dollars a tonne from 1,933 dollars.
-- Three-month lead increased to 2,340 dollars a tonne from 2,251 dollars.
-- Three-month tin gained to 14,975 dollars a tonne from 14,680 dollars.
-- Three-month zinc rose to 2,230 dollars a tonne from 2,165 dollars.
-- Three-month nickel climbed to 16,840 dollars a tonne from 16,050 dollars.
COCOA: Cocoa prices diverged, falling in London but rising in New York. By Friday on Liffe, London's futures exchange, the price of cocoa for delivery in December weakened to 2,190 pounds a tonne from 2,022 pounds a week earlier. On the New York Board of Trade (NYBOT), the March cocoa contract rallied to 3,310 dollars a tonne from 3,117 dollars.
SUGAR: Sugar prices also struck a mixed note. By Friday on Liffe, the price of a tonne of white sugar for delivery in March edged up to 601 pounds from 593 pounds a week earlier. On NYBOT, the price of unrefined sugar for March nudged lower to 22.10 US cents a pound from 22.56 cents.
GRAINS AND SOYA: Grains and soya prices held in positive territory. By Friday on the Chicago Board of Trade, maize for delivery in March rose to 4.10 dollars a bushel from 4.05 dollars a week earlier. January-dated soyabean meal - used in animal feed - climbed to 10.41 dollars from 9.87 dollars. Wheat increased to 5.79 dollars a bushel from 5.59 dollars.
COFFEE: Coffee prices steadied. By Friday on Liffe, Robusta for delivery in January eased to 1,330 dollars a tonne from 1,331 dollars a week earlier. On the NYBOT, Arabica for March firmed to 136.50 US cents a pound from 134.50 cents.
RUBBER: Malaysian rubber prices rose due to limited supplies as a result of rainy weather and in line with many other commodity markets. Dealers said there was concern that the current output may not be able to meet the strong demand and that prices may increase further. On Friday, the Malaysian Rubber Board's benchmark SMR20 climbed to 250.30 US cents per kilo, from 241.80 cents last week.
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