UPDATE 7-Copper soars almost 14 pct in base metals bounceWed Oct...

UPDATE 7-Copper soars almost 14 pct in base metals bounce
Wed Oct 29, 2008 1:24pm EDT

* - Copper soared almost 14 percent,pulling other base metals higher on Wednesday, buoyed by a weaker dollar and as investors eagerly await an expected interest rate cut from the U.S. Federal Reserve.

Copper MCU3 for three month delivery on the London Metal Exchange jumped 13.7 percent to $4,696 a tonne, the highest price since Oct. 21, before closing at $4,655.
It closed at $4,130 on Tuesday. The three-months copper contract last week posted its biggest weekly fall -- more than 20 percent -- since at least 1977, according to Reuters data. It has slumped almost 50 percent since July's record high of $8,940. "We have just had a massive sell-off and prices have gone well into the cost curves for a lot of the commodities,particularly nickel and zinc," said Jim Lennon, analyst at Macquarie Bank. Prices close to the marginal cost of production have forced
some miners to cut output and delay expansion projects.

Copper rose for the third consecutive day and prices have
jumped 25 percent so far this week. The dollar weakened aginst the euro making metals cheaper for holders of other currencies. Also supportive was an announcement from Codelco, the world's biggest copper producer, that a production cut at its largest division would trim 78,000 tonnes from overall output from 2009-2011. [ID:nN29478934]

Chile, the largest copper producing country, also trimmed
its 2008 copper output forecast for the second time since July,this time to 5.45 million tonnes, citing operational issues but not slumping prices for the red metal. [ID:nN29476965]

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http://www.reuters.com/article/marketsNews/idINLT66280320081029?rpc=44