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Copper Prices Reach Record Territory Amid Dollar Weakness

Strategic Insights

— 1 min read

Copper prices surged to record highs on the Comex division of the New York Mercantile Exchange, driven by dollar weakness and comments from Federal Reserve Chairman Ben Bernanke. The most active contract for March delivery reached $4.1255 a pound, surpassing the previous highest settlement price of $4.0635 set in July 2008. The weaker dollar made dollar-denominated contracts like copper futures more attractive to investors using foreign currencies, with the euro recently trading at $1.3395. Market analysts believe copper futures are likely to test or exceed the $4.20 range, with old highs serving as targets.

Key Takeaways:

  • Copper prices rose to record territory, supported by dollar weakness and Federal Reserve Chairman Ben Bernanke's comments.
  • The most active contract for March delivery was recently up 2.9%, or 11.75 cents, at $4.1255 a pound on the Comex division of the New York Mercantile Exchange.
  • Copper is trading in record-making territory, above its highest settlement price of $4.0635 set on July 2, 2008.
  • The weaker dollar made copper futures appear cheaper to investors using foreign currencies, with the dollar recently at $1.3395 against the euro.
  • Analysts expect copper futures to test or exceed the $4.20 range, with old highs serving as targets.
  • The Federal Reserve's monetary policy and Bernanke's comments on possible quantitative easing boosted copper prices.
  • Copper prices continued to draw strength from Bernanke's weekend comments, suggesting a larger monetary stimulus may be needed to prevent the U.S. economy from slipping back into a recession.

Statistics:

  • Copper prices rose 2.9% or 11.75 cents to $4.1255 a pound.
  • The dollar was trading at $1.3395 against the euro.
  • The highest settlement price of copper was $4.0635, set on July 2, 2008.
  • The record intraday high of copper was $4.2605, set on May 5, 2008.
  • The Federal Reserve launched a $600 billion Treasury-purchasing program aimed at increasing liquidity and maintaining low interest rates.

Sources:

  • Dow Jones Commodities News via Comtex
  • FuturePath Trading, Frank Lesh
  • Dow Jones Newswires, Tatyana Shumsky
  • CBS' "60 Minutes"
  • The Federal Reserve

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