Investing.com - Copper futures rallied for a fourth day on Thursday, trading at the highest level since mid-September as appetite for riskier assets was boosted by the Federal Reserve’s pledge to keep rates at historically low levels until at least late-2014.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.901 a pound during European morning trade, surging 1.85%.
It earlier rose by as much as 1.95% to trade at USD3.902 a pound, the highest since September 19.
At the conclusion of Wednesday’s policy-setting meeting, the Fed’s Open Market Committee said in a statement that economic conditions “are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”
The new commitment replaces the statement that economic conditions were likely to stay at the historic low range of 0% to 0.25% until at least mid-2013.
Low interest rates can make holding copper and other commodities more appealing compared with interest-bearing assets.
At his press conference following the decision, Fed Chairman Ben Bernanke said that policy makers were “prepared to provide further monetary accommodation” and added that bond buying is “an option that’s certainly on the table.”
The comments fuelled speculation that the central bank may embark on a third round of quantitative easing, sending the U.S. dollar lower against its major counterparts.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.44% to trade at 79.25, the lowest since December 12.
A weaker dollar can boost dollar-denominated copper and other commodities by making the futures cheaper for buyers using other currencies.
Meanwhile, in the euro zone, talks on a debt swap deal between Greece and its creditors were to resume in Athens later in the day.
An agreement is necessary if Greece is to get the next tranche of bailout funds that would prevent a devastating debt default. Greece does not have enough money to cover a EUR14.5 billion bond repayment due March 20.
Copper prices have rallied nearly 12% since the beginning of 2012, buoyed by expectations that demand from top consumer China will remain strong and that the global economy was recovering despite the effects of the euro zone’s debt crisis.
Elsewhere on the Comex, gold for February delivery jumped 0.95% to trade at a six-week high of USD1,716.45 a troy ounce, while silver for March delivery gained 1.05% to trade at a two-month high of USD33.47 a troy ounce.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.901 a pound during European morning trade, surging 1.85%.
It earlier rose by as much as 1.95% to trade at USD3.902 a pound, the highest since September 19.
At the conclusion of Wednesday’s policy-setting meeting, the Fed’s Open Market Committee said in a statement that economic conditions “are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”
The new commitment replaces the statement that economic conditions were likely to stay at the historic low range of 0% to 0.25% until at least mid-2013.
Low interest rates can make holding copper and other commodities more appealing compared with interest-bearing assets.
At his press conference following the decision, Fed Chairman Ben Bernanke said that policy makers were “prepared to provide further monetary accommodation” and added that bond buying is “an option that’s certainly on the table.”
The comments fuelled speculation that the central bank may embark on a third round of quantitative easing, sending the U.S. dollar lower against its major counterparts.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.44% to trade at 79.25, the lowest since December 12.
A weaker dollar can boost dollar-denominated copper and other commodities by making the futures cheaper for buyers using other currencies.
Meanwhile, in the euro zone, talks on a debt swap deal between Greece and its creditors were to resume in Athens later in the day.
An agreement is necessary if Greece is to get the next tranche of bailout funds that would prevent a devastating debt default. Greece does not have enough money to cover a EUR14.5 billion bond repayment due March 20.
Copper prices have rallied nearly 12% since the beginning of 2012, buoyed by expectations that demand from top consumer China will remain strong and that the global economy was recovering despite the effects of the euro zone’s debt crisis.
Elsewhere on the Comex, gold for February delivery jumped 0.95% to trade at a six-week high of USD1,716.45 a troy ounce, while silver for March delivery gained 1.05% to trade at a two-month high of USD33.47 a troy ounce.