* Fed's bond buying seen extending to March
* China may increase term bookings of copper imports in '14
* China aluminium output seen at record this year - Chalco
By Harpreet Bhal
LONDON, Oct 30 Copper rose to its highest level
in a week on Wednesday, boosted by expectations the U.S. Federal
Reserve will prolong its stimulus programme to aid recovery in
the world's largest economy.
Benchmark copper on the London Metal Exchange ended
up more than 1 percent at $7,298 a tonne, from a close of $7,200
on Tuesday, but off a peak of $7,299.50 a tonne hit earlier, its
highest since Oct. 23.
LME aluminium was last bid at $1,892 a tonne, up
from Tuesday's close at $1,883, having earlier climbed to
$1,898, not far from a two-month high of $1,905.75 hit in the
The Fed was expected to preserve its monthly bond-buying
campaign when it concludes a two-day meeting later in the day
and to point to softer readings on the U.S. economy to signal
that the policy will be extended into 2014.
The Fed was due to announce its decision at 1800 GMT.
A private sector U.S. jobs report out earlier showed U.S.
companies hired 130,000 workers this month, below the 150,000
forecast by economists polled by Reuters. The number added
weight to expectations that the Fed's support for the economy is
"If the Fed keeps the patient on tapering medicine for
longer, this could be good news for copper, and we could see the
metal breaking its resistance of $7,334," said Naeem Aslam,
chief market analyst at Ava Trade.
Ultra-loose monetary policy around the world in the past few
years has drawn investors to commodities as an alternative to
The dollar fell against a basket of major world currencies,
having hit a nine-month low on Friday amid expectations of a Fed
tapering delay. A weak dollar makes metals priced in dollars
cheaper for non-U.S. investors.
"We suspect that investors will likely move to the sidelines
ahead of the (Fed) policy statement. However, once this is over,
we suspect that metals will likely resume their push higher, as
the weaker dollar and an accommodative Fed both lend support,"
said INTL FCStone analyst Ed Meir.
In the euro zone, data signalled a recovery in Europe was
strengthening. Confidence in the region's economy improved more
than expected in October, driven by more optimism in industry,
while the business climate indicator rallied to an 18-month
In a bright spot for the demand outlook, Chinese firms may
increase term bookings of refined copper imports in 2014,
despite a forecast jump in premiums, because they are becoming
more confident on the economic outlook and demand for copper as
a financing tool remains strong.
China is the world's largest copper consumer, accounting for
around 40 percent of global refined demand.
Importers and traders at a copper conference in Kunming
organised by state-backed research firm Antaike said they were
optimistic that China's economy had bottomed.
Antaike said China's consumption of refined copper would
grow more quickly in 2014, though not fast enough to boost
imports significantly as its production increases at an even
In aluminium, Chinese output is likely to hit a record 24
million tonnes this year, a research director at the country's
top producer of the metal said, suggesting production may ramp
up towards year-end.
In other metals traded, zinc was last bid up 0.10
percent at $1,969 a tonne, lead ended up 0.18 percent at
$2,209 a tonne, tin ended down 0.19 percent at $23,125 a
tonne, and nickel ended up 0.99 percent at $14,750 a
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Three month LME tin