Sun, Nov 10, 2013 - Page 15 News List

Strong greenback, high supplies hit raw material prices

DOMINANT DOLLAR:The US currency has fed into up the growing speculation that the Fed will start tapering its bond-buying soon, driving down many commodities

AFP, LONDON

A strengthening US dollar amid a backdrop of ample supplies sent the prices of oil, most metals and coffee sliding this week, analysts said.

The greenback had been rising strongly since Thursday after the European Central Bank surprisingly cut its main interest rate and extended its gains heading into the weekend due to rising expectations that the US Federal Reserve will shortly begin tapering its stimulus.

OIL: Crude futures hit multimonth low points owing to a strengthening US dollar, hopes of a deal over Iran’s nuclear standoff and high US stockpiles, analysts said.

New York prices on Tuesday hit five-month lows at US$93.37 a barrel, amid rising US crude inventories. Brent on Friday struck a four-month trough at US$102.98 a barrel.

Better-than-expected US economic growth and jobs data supported market expectations that the Fed will soon roll back its stimulus.

By Friday on London’s Intercontinental Exchange, Brent North Sea crude for next month slid to US$104.47 a barrel from US$108.63 a week earlier.

On the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for next month retreated to US$94.44 a barrel from US$96.23 last week.

PRECIOUS METALS: Gold prices were also hit by the stronger US dollar and rising expectations that the Fed will shortly begin cutting its stimulus program.

By late on Friday on the London Bullion Market, the price of gold dropped to US$1,285.50 an ounce from US$1,306.75 a week earlier, while silver fell to US$21.70 an ounce from US$21.75.

On the London Platinum and Palladium Market, platinum slipped to US$1,446 an ounce from US$1,453, as palladium strengthened to US$757 an ounce from US$737.

COFFEE: Arabic coffee struck US$0.10095 a pound (0.45kg) — the lowest level since October 2006 — on bumper harvest prospects.

By Friday on the ICE Futures US exchange in New York, Arabica for delivery next month had fallen to US$0.10370 a pound from US$0.10505 a week earlier.

On LIFFE, London’s futures exchange, Robusta for January stood at US$1,457 a tonne, unchanged from a week earlier.

SUGAR: Prices of sugar extended recent losses this week.

“Prices could continue to work lower in the short term. There is still a lot of sugar available to the world market despite the logistical problems in Brazil,” Price Futures Group analyst Jack Scoville said.

By Friday on the ICE Futures US exchange, the price of unrefined sugar for delivery in March next year dropped to US$0.1808 a pound from US$0.1834 a week earlier.

On LIFFE, the price of a tonne of white sugar for delivery in March slid to US$481.50 from US$488 a week earlier.

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