Metals hit new highs before declining

Prices for precious and base metals dropped on Monday, although they are still up substantially since the beginning of the year.

Silver his a high during the day of $13.19 per troy ounce during the day but by early in the day in New York it had dropped to $12.22 per troy ounce, a drop of seven percent from the day’s high and five percent off Friday’s close. The price of silver, however, is still up 38 percent since the first of the year. Analysts are attributing the gains silver has been seeing to the upcoming introduction of a silver-backed exchange traded fund, but it is not known when that will be launched.

Gold was down to $627.20/$628.10 per troy ounce, a drop of about $5 from its close on Friday and nearly $20 below the 25-year high price it hit last week.

Base metals hit new highs during the day before dropping back, as well. Copper hit a record $6,925 per tonne, or over $3 per pound, on the London Metal Exchange before settling to $6,765 late in the day, down $15 from Friday’s close. Meanwhile, the Chilean Copper commission set its average price forecast for 2006 at $2.60 to $2.64 per pound, up from its previous estimate of $1.72 to $1.76 per pound. It predicted that the average price for a pound of copper in 2007 would be between $2.40 and $2.44.

In other base metals, aluminium saw a high price of $2,789 per tonne before it dropped back to $2.729 late in the day, a loss of $49 from Friday’s closing price. Zinc also set a new record price at $3,360 per tonne before falling $45 from Friday’s close to $3,265 per tonne. Nickel was down $25 on the day to $19,375 per tonne after hitting a new record of $19.600 per tonne earlier. Despite the drop, nickel is still 27 percent higher than it was at the beginning of the month.