Copper advanced toward a 27-month high, while zinc and lead increased to their highest level since January, as industrial metals rallied on demand from investors seeking to protect their wealth against a decline in the dollar.
Copper for three-month delivery gained as much as 1.5 percent to $8,460 a metric ton on the London Metal Exchange and traded at $8,458 a ton at 11:12 a.m. in Singapore. The metal used in construction and household appliances reached $8,492 a ton on Oct. 19, the highest level since July 2008.
“Metals have moved beyond their fundamentals now and it’s basically speculative demand linked to a weaker dollar that’s supporting higher prices,” said Sun Zhiyin, an analyst at Shanghai Continent Futures Co.
The dollar fell 0.6 percent, declining for the first time in three days, against a six-currency basket including the euro and yen. The index last week snapped a five-week losing streak.
Group of 20 finance ministers and central bankers ended talks in South Korea on Oct. 23 pledging to refrain from “competitive devaluation” and to let markets set foreign- exchange values more as they sought to calm fears that they risk a trade war by using cheaper currencies to spur growth.
Zinc gained as much as 2.1 percent to $2,565 a ton and lead added as much as 1.6 percent to $2,570 a ton on the LME, the highest levels since January, after China’s third-largest zinc producer shut its biggest zinc and lead smelter.
Shenzhen Zhongjin Lingnan Nonfemet Co. suspended output from Oct. 21 at its Shaoguan smelter in Guangdong after authorities found that excessive levels of thallium were discharged by the plant into a river, the company said. Zinc is used to galvanize steel while lead is used in batteries.
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