LONDON: Gold, tin, rubber and cotton hit record peaks this week, aided by keen demand, the tumbling dollar and strengthening hopes of new monetary easing measures from the US Federal Reserve, analysts said.
?Commodity prices continued to post strong gains throughout the week, with gold, tin, rubber and cotton hitting record highs, and other commodities hitting multi-year peaks,? said Barclays Capital analyst Kerri Maddock.
?While this price strength has been widely attributed to the weakness of the dollar in the media, the underlying fundamentals (of supply and demand) have continued to improve, making these price moves justified in our view.?
The dollar was rocked on Tuesday after the Fed hinted that it would likely adopt more quantitative easing (QE) measures ? by buying up bonds and other assets ? to boost the faltering American economy.
Precious metals: Gold prices blazed a record-breaking trail to $1,387.35 an ounce, dragging sister metal silver to a 30-year pinnacle at $24.92, while palladium set a nine-year high at $605.13.
?Once again gold dominates the headlines, with yet another new record high,? said Rajesh Patel at trading firm Spread Co.
Silver advanced to $24.42 an ounce from $22.37. On the London Platinum and Palladium Market, platinum gained to $1,691 an ounce from $1,683. Palladium climbed to $591 an ounce from $572.
Base metals: Tin was the star performer, forging an all-time peak at $27,338 a tonne on Thursday amid stretched supplies. ?Industrial metals have continued their strong rally supported by increased expectation for QE2 (and) US dollar weakness,? said Deutsche Bank analyst Daniel Brebner.
By late Friday on the London Metal Exchange, copper for delivery in three months rallied to $8,392 a tonne from $8,270 a week earlier.
Three-month aluminium eased to $2,390 a tonne from $2,400. Three-month lead rose to $2,387 a tonne from $2,272. Three-month tin jumped to $26,874 a tonne from $26,300 from a week earlier. Three-month zinc gained to $2,408 a tonne from $2,293. Three-month nickel dipped to $23,900 a tonne from $24,405.
Cotton: Cotton struck an all-time peak at $1.1980 a pound in New York, as inventories dropped amid growing demand in Asia. That beat the previous record set in 1995.
?Continued robust Asian demand ? and Chinese import demand in particular ? coupled with supply-side problems and the marked decline in stocks has underpinned the rally,? said Barclays Capital analyst Sudakshina Unnikrishnan.
By Friday in New York, cotton for December rose to $1.0987 a pound from $1.0717 a week earlier.
Oil: Crude oil briefly topped 85 dollars in London, helped by data showing surprisingly strong global energy demand, before slipping on profit-taking.
Traders also digested OPEC?s decision to maintain its output target, alongside news of a surprise drop in crude reserves in the United States, the world?s top oil consumer.
The Organisation of Petroleum Exporting Countries (OPEC) left its official oil production ceiling unchanged on Thursday, in line with expectations in the face of an uncertain economic outlook, after a high-profile meeting in Vienna.
OPEC, which pumps 40 percent of the world?s oil, agreed to keep its target at 24.84 million barrels a day.
Meanwhile, the US Department of Energy revealed that American crude stockpiles fell unexpectedly by 400,000 in the week ending October 8, against expectations for 1.2-million-barrel gain. afp
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