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Strengthening of the US dollar entails a decline in world prices for copper

Lower copper prices caused by the strengthening US dollar and causing considerable concern about a possible tightening of monetary policy in the People's Republic of China — the largest consumer of this type of metal.

Futures on copper with an estimated delivery through the third month on the world-famous London Metal Exchange were offered at a price of more than eight and a half thousand US dollars per ton. However, even at the close of trading on Friday, the price was 8, 615-five dollars.

It is noteworthy that a moderate increase in the price of copper in recent weeks, achieved thanks to the high activity of investment funds, involuntary weakening of the US dollar, significant improvement of macroeconomic statistics, as well as concerns that are directly related to the market supply. However, on Monday it failed to note that the US dollar rose to a six-week peak of the so-called basket of currencies, while the European currency (the euro) fell because of some problems in Ireland. The generally accepted fact that with an increase in the dollar, there is some reduction in metal prices as outside the United States, they are not so attractive for foreign investors.

At the same time the existing stocks in the warehouses of copper markedly decreased on the first day of the week by as much as 75 tons of stones and diamonds. Now their number — a little over 262's tons, but the 6-five years ago this figure was — 555 mb tone. There is another interesting trend, if instead of the three-month copper futures purchase contracts with instant delivery, the per ton of metal would have to pay a premium of 7.5 minutes of dollars.

Do not forget also that on the largest deposit of copper «Collahuasi» (Chile) continues to strike eleven days. According to the owners of the field, this situation will not affect the work, and this despite the fact that the union promises, if the strike drags on for an indefinite amount of time.

It is worth noting that on the same Monday observed a decrease in aluminum prices at 36-ty dollars compared to the sale, held last Friday. Also, there is some reduction of its reserves, which are currently provided in an amount of 2, 25 million tons of Th. A similar trend is observed in the global nickel market (a decrease by 490-ta US dollars) and tin (600-ton US dollars).

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