Commodities surged this week, with many striking multi-month peaks after the US Federal Reserve embarked upon new stimulus plans to boost the US economy, a major consumer of raw materials.
Global markets rallied after the Fed said on Thursday it would start a third program to purchase US$40 billion per month in mortgage-backed bonds — known more commonly as quantitative easing (QE3).
OIL: Prices hit four-month highs on news of more stimulus measures in the world’s largest crude consuming nation, and on the back of ongoing geopolitical tensions in the Middle East.
Brent North Sea crude soared to US$117.95 a barrel, touching the highest level since early May. New York’s West Texas Intermediate surged to a similar peak at US$100.42.
“The Fed’s announcement has caused crude oil prices to climb to multi-month highs,” Commerzbank analyst Carsten Fritsch said.
Crude futures also jumped higher in the wake of violent protests touched off by a film mocking Islam that was posted on the Internet.
By late Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in October leapt to US$116.68 a barrel from US$112.93 a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for October rose to US$98.87 a barrel compared with US$94.81 the previous week.
PRECIOUS METALS: Gold surged to a six-month high on the back of the Fed stimulus, while platinum was propelled by fresh labor unrest in key producer South Africa.
“The gold price rose ... and looks set to continue its upward trajectory in the current economic climate as an increasingly inflationary environment in the United States is supportive of a strong gold price going forwards,” Westhouse Securities analyst Rob Broke said.
Gold raced as high as US$1,778 per ounce, the highest level since Feb. 29. Silver meanwhile jumped to US$34.94, last reached in March.
At the same time, platinum soared to US$1,715.12 an ounce — also last seen on Feb. 29.
“The [platinum] price has rebounded strongly since mid-August, up by more than 20 percent to US$1,700, largely on news of severe supply disruptions in South Africa,” BNP Paribas analyst Anne-Laure Tremblay said.
By late on Friday on the London Bullion Market, gold surged to US$1,775.50 an ounce from US$1,728 a week earlier.
Silver soared to US$34.71 an ounce from US$32.22.
On the London Platinum and Palladium Market, platinum increased to US$1,697 an ounce from US$1,593.
Palladium gained to US$702 an ounce from US$647.
BASE METALS: Industrial metals also hit multi-month pinnacles.
On Friday, copper, tin and nickel hit four-month highs. Aluminium and zinc scored peaks last witnessed in late March, while lead hit a level last seen at the end of February.
By late Friday on the London Metal Exchange, copper for delivery in three months jumped to US$8,399 a tonne from US$7,822 a week earlier.
Three-month aluminum soared to US$2,190 a tonne from US$2,003. Three-month lead climbed to US$2,254 a tonne from US$2,079.
Three-month tin rocketed to US$21,350 a tonne from US$19,915. Three-month nickel leapt to US$17,640 a tonne from US$16,300.