Copper ended up over 2 percent on Friday, posting its biggest weekly advance since early December, as the dollar weakened and investor demand for the metal increased with inflation fears mounting. The gains ran far and wide in the base metals complex, with another record tin price, a three-year peak in the price of lead and aluminium touching its loftiest level since August 2008.
Interest rate hikes by China and the European Central Bank this week failed to contain the bullish momentum, as investors eyeing greater inflationary threats in emerging and developed economies alike continued to flock to hard assets like copper, precious metals and crude oil as hedges. London Metal Exchange (LME) three-month copper rallied $205 to close at $9,875 per tonne, near a session peak of $9,896 - its highest in more than a month.
COMEX May copper surged 8.50 cents, or 1.9 percent, to settle at $4.5015 per lb. For the week, prices were up about 5.7 percent - their largest weekly gain since the first week of December 2010. The recent bout of price strength placed both London and New York copper contracts a little more than 3 percent away from their mid-February records at $10,190 per tonne and $4.6575 per lb, respectively.
Reinforcing the near-term sluggishness in demand, stocks of copper saw another 1,800 tonnes flow into LME warehouses on Thursday, bringing total levels to 444,175 tonnes, their highest since July 2010. But a big 4.8 percent withdrawal in copper inventories in warehouses monitored by the Shanghai Futures Exchange pointed to healthier demand prospects into the seasonally better second quarter.
In other metals, aluminium peaked at $2,715 per tonne, its highest since August 2008, before ending up $41 at $2,713. Tin extended gains after the close to a fresh record at $33,100 per tonne, It closed the kerb up $500 at $33,050. Lead hit a three-year high of $2,870, and closed up $60 at $2,850.