Dollar declines push metals prices higher

Metals prices were higher Monday as the US dollar declined on concerns about the financial sector and on sentiment that the Federal Reserve could cut US interest rates again.

Gold was up on the perception that it is a safe investment in a volatile market environment and on worries that confidence will not be enhanced much even if the US government plan to buy up bad debt from banks win the approval of Congress.

December gold was up $43.80 to $908.50 per troy ounce just before the close of floor trade in New York, while December silver added 98 cents to $13.45 per troy ounce and October platinum gained $88.80 to $1,235.80 per troy ounce.

Base metals were also higher on the session.

December copper added 8 cents to $3.26 per pound in New York while three-month copper gained $190 to $7,250 per tonne in London, primarily due to the dollar’s weakness and the decline of 3,100 tonnes in London Metal Exchange inventories, particularly in warehouses located in Asia.

The decline of Asian stockpiles suggested that demand from top consumer China could be on the rise.

Aluminium was up $13 to $2,548 per tonne and went as high as $2,577 per tonne earlier in the session even though inventories gained 15,650 tonnes to 1.35 million tonnes, their highest level in four and a half years.

Zinc prices added $82 to $1,840 per tonne while lead was up $90 to $1,990 per tonne, nickel was $500 higher to $17,400 per tonne and tin gained around $800 to about $17,700 per tonne.