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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: NOW who wrote (2653)	11/27/2003 11:05:49 AM
From: russwinter	Read Replies (1) \| Respond to of 110194

Warning, the dogs are loose, take your garbage off the curb: 1% US fed funds rate, and runaway Chinese economy is apparently a green light for speculators and hedge funds to load up on base metals. Reuters Investment funds help base metals fly-ANZ bank Wednesday November 26, 11:10 pm ET SYDNEY, Nov 27 (Reuters) - The cost of base metals used in everything from plumbing to steak knives to airplane wings is rising rapidly thanks to investment funds buying up large tonnages on futures markets, a report on Thursday said. "Investment funds have pushed metals prices to record highs," Australia and New Zealand Banking Group Ltd metals analyst Peter Windred said in the report. Open interest on trades - the number of outstanding futures contracts - on the London Metal Exchange has reached record levels, Windred said. "We have entered a minerals commodities boom," he said. High demand from fast-industrialising China and indicative positive news out of the United States had "dropped the flag" for investment funds to buy into metals, Windred said. "Nickel is the stand out performer as the price hits a 14-year high as supply constraints and investor activity takes hold. Copper is our second-favoured commodity," Windred said. Nickel, used to make stainless steel, is fetching more than $5.40 a tonne, the highest price in 14 years. Copper, a staple in telecommunications wire, computer chips and water pipes, sells for a multi-year high above $0.90 a pound. ANZ has forecast an across-the-board rise in base metals prices next year, with increases carrying through to less costly metals, including aluminium, zinc and lead. Below is year-to-date average prices of metals to November 24 and ANZ's 2003 and 2004 forecasts (U.S. cents per pound): YTD 2003 2004 Aluminium 64.2 64.0 67.1 Copper 78.1 79.4 97.5 Nickel 410 408 530 Lead 22.3 22.0 29.5 Zinc 36.7 37.3 42.2