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Metals Prices Mostly Higher; Copper Claws out From Bear Market

Published 2018-08-21, 02:08 p/m
Updated 2018-08-21, 02:13 p/m
Copper prices exited bear-market territory on Tuesday

Copper prices exited bear-market territory on Tuesday

Investing.com - Gold prices hit one-week highs Tuesday and copper clawed its way out of bear-market territory, helped a plunge in the dollar after President Donald Trump criticized the leader of Federal Reserve for raising rates.

Gold futures for December delivery on the Comex division of the New York Mercantile Exchange rose by $6.10, or 0.51%, to $1,200.70 per troy ounce.

Gold prices continued to add to gains following a sharp jump on Monday, led by a fall in dollar, as Trump called on the Federal Reserve to do more to boost growth and criticized Fed Chairman Jerome Powell for raising rates.

While investors are not expecting Fed policymakers to ditch their plans for further rate hikes, they fled the dollar amid fears Trump's comments would cast a shadow over the central bank's future decision-making.

The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.68% to 95.03.

Dollar-denominated assets such as gold are sensitive to moves in the dollar. A fall in the dollar makes gold cheaper for holders of foreign currency and raises demand.

Trump's critique of the Federal Reserve's recent rate hikes comes just a day before the Fed releases the minutes from its last meeting, which could provide clues on the central bank's thinking concerning monetary policy.

The Federal Reserve has projected tighetening at a moderate pace, with the market predicting four hikes for this year. The third rate hike expected as soon as September and the fourth in December.

Gains in the wider metals market were mixed, however, as copper prices clawed their way out from bear-market territory, while nickel came under pressure.

Copper prices rose 0.96% to $2.69, while zinc prices rose 2.07% at 2,427.75.

Copper had fallen sharply last week to post losses of 20% from its high of $3.30 in June, meeting the common definition of a bear market. But two-straight daily gains this week has helped it shift direction.

Aluminium prices rose 0.15% to 2,061.50, while nickel futures fell 0.46% to 13,537.50.

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