Copper heads up, gold drops

MINUTES from a Federal Reserve meeting has fuelled speculation that interest rates may be on the rise, prompting gold prices to fall to their lowest in a week.
Copper heads up, gold drops Copper heads up, gold drops Copper heads up, gold drops Copper heads up, gold drops Copper heads up, gold drops

Bloomberg reported that officials were divided in last month's meeting on whether to boost interest rates in June.

The holdings in exchange-traded products backed by the precious metal fell to a three-month low of 1616.1 tonnes, with traders are studying the economic data for more signals of a rate rise.

Copper prices may be on an upward trajectory this year, with Macquarie seeing the metal's three-month futures-for-delivery approaching $US6500 a tonne.

However, it also warns of a 6% fall of total output by copper miners this year if problems facing the industry continue. Natural disasters and labour disputes have reduced output by 280,000t.

Speculation of a Chinese stimulus package, coupled with lower supply, has lifted the copper price after it had dropped to a five-year low in January.

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