The price of copper rose to the highest level in 27 months on Monday, as commodity brokers speculated that both quantitative easing from the Federal Reserve and falling inventories of the red metal will make it pricier.
Interestingly, the dollar climbed against a basket of currencies today, beating the Canadian dollar, Brazilian real, Japanese yen, British pound and the euro.
But copper gained on top of the U.S. currency, rising 1.5 cents to close at $3.7895 per pound on the Comex in New York. During the day's trading, the price hit $3.82 per pound, which is the highest level the metal has seen since 2008.
"Prices are up on economic optimism," Adam Klopfenstein, a senior market strategist at a broker in Chicago, told Bloomberg News. "Copper is looking beautiful to the upside."
Copper plays an interesting role in international commodities markets, because it can gain on both falling currencies and on prospects for economic growth. Since it is so important in manufacturing and electronics, it's particularly sensitive to indicators of gross domestic product growth.
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