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Copper futures rally to 2-week high on Fed easing expectations

Published 05/22/2013, 05:14 AM
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Investing.com - Copper futures rose sharply to hit a two-week high on Wednesday, amid expectations the Federal Reserve will maintain its loose monetary policy for the indefinite future.

On the Comex division of the New York Mercantile Exchange, copper futures for July delivery traded at USD3.383 a pound during European morning trade, up 1.2% on the day.

New York-traded copper prices rose by as much as 1.5% earlier in the day to hit a session high of USD3.391 a pound, the strongest level since May 8.

Investors looked ahead to testimony at the U.S. Joint Economic Committee by Federal Reserve Chairman Ben Bernanke, amid speculation over whether the U.S. central bank will begin to scale back its asset purchase program this year.

The minutes of the Fed’s May meeting are to be released later in the trading day.

On Tuesday, St. Louis Fed President James Bullard said the Fed should continue its bond buying and make adjustments as the economy changes.

Comments by New York Fed President William Dudley were also interpreted as suggesting the central bank wasn’t about to taper off its bond-purchase program.

Bullard and Dudley will both vote at the central bank's next scheduled meeting on June 18-19.

Copper traders also awaited key manufacturing data out of China due on Thursday to gauge the strength of demand from the world’s largest copper consumer.

Data on Tuesday showed that refined copper imports to China in April fell 33% from a year earlier and down 16% from March.  

Elsewhere on the Comex, gold for June delivery rose 0.6% to trade at USD1,385.65 a troy ounce, while silver for July delivery added 0.6% to trade at USD22.58 a troy ounce.

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