(MENAFN- Arab Times) Gold prices hit multi-year low points this week, hit by a stronger dollar and weak Chinese demand. With metals prices generally weak, mining groups Anglo American and Lonmin on Friday announced plans to cut their headcounts by up to a combined 12,000 staff. Precious Metals: Gold slumped to the lowest point in nearly five and a half years, weighed down by the strong dollar and reports of massive selling in China, dealers said.
The metal struck $1,072.35 an ounce on Monday - the lowest level since February 2010. Sister metal silver hit a six-year trough at $14.37 an ounce and platinum reached the lowest level in more than six years to $946.25 an ounce. "It can't be overestimated how much sentiment towards purchasing gold has been weakened following the stunning and sudden drop below $1,100 at the beginning of the week," said Jameel Ahmad, chief market analyst at trading group FXTM. "There was already clear hesitation from buyers towards purchasing gold as the markets approach the timing of a US interest rate rise and such a sudden decline in the value of gold has further eliminated investors from even considering positions."
Gold had already slid the previous week on the back of the strong dollar, which soared last week after US Federal Reserve chief Janet Yellen reaffirmed expectations of an interest rate hike by year-end. The precious metal failed also to benefit from its traditional status as a haven investment. "The fact that the Greek debt crisis and the Chinese stock market rout failed to reignite a safe haven bid was what broke the camel's back," said Saxo Bank analyst Ole Hansen.
A stronger US currency meanwhile makes dollar-denominated commodities such as gold more expensive for buyers using weaker currencies. That tends to dent demand and pull prices lower. By Friday on the London Bullion Market, the price of gold dropped to $1,080.80 an ounce from $1,132.80 a week earlier. Silver fell to $14.49 an ounce from $15.01.
On the London Platinum and Palladium Market, platinum slipped to $979 an ounce from $998. Palladium retreated to $616 an ounce from $655.
Oil: Prices slid on persistent concerns about abundant supplies in a slowing global economy. New York crude finished below $49 a barrel on Thursday for the first time since March 31. On Friday, Brent North Sea crude struck a near four-month low at $54.40. The US Department of Energy on Wednesday said the country's commercial crude stockpiles rose 2.5 million barrels last week, while supplies at the closely watched Cushing, Oklahoma, hub were up 800,000 barrels.
The report also showed US production staying at near-record levels of about 9.6 million barrels per day, bad news for a market already awash with crude from the Organization of Petroleum Exporting Countries (OPEC). Dampening appetite also is the prospect of Iranian oil returning to the oversupplied market after Tehran recently reached a deal with major powers over its nuclear ambitions. The Iranian deal will see world powers lift crippling economic sanctions, which have restricted Iran's oil exports, in return for toning down its atomic programme.
Iran has the fourth biggest proven oil reserves in the world. Oil prices have plummeted from above $100 a barrel in June last year because of the supply glut brought about by strong production from the United States and OPEC led by Saudi Arabia. On the New York Mercantile Exchange, West Texas Intermediate (WTI) or light sweet crude for September stood at $48.01 a barrel compared with $50.34 a barrel for the expired August contract a week earlier. Base Metals: Prices were hit by weak Chinese data, with copper striking a six-year low at $5,191.50 a tonne on Friday.
The figure was the weakest reading since 48.1 in April 2014, according to Markit's data. By Friday on the London Metal Exchange, copper for delivery in three months slid to $5,245 a tonne from $5,507 a week earlier. Three-month aluminium decreased to $1,636.50 a tonne from $1,707.50. Three-month lead fell to $1,714.50 a tonne from $1,835. Three-month tin dropped to $14,910 a tonne from $15,675. Three-month nickel retreated to $11,250 a tonne from $11,465. Three-month zinc declined to $1,958.50 a tonne from $2,074.
Cocoa: Prices hit one-month lows after reaching four-year peaks the previous week on tight output in Ghana. By Friday on the ICE Futures US exchange, cocoa for September decreased to $3,197 a tonne from $3,335 the previous week. Sugar: Prices extended losses. On ICE Futures US, unrefined sugar for October fell to 11.38 US cents from 11.94 cents.
Coffee: Prices hit an 18-month low at 120.85 US cents a pound in New York on currency factors. By Friday on LIFFE, Robusta for September decreased to $1,651 a tonne from $1,674 one week earlier. On ICE Futures US, Arabica for delivery in September slipped to 121.10 US cents a pound from 127.40 cents.
Rubber: Prices fell as Malaysia's ringgit currency rose and as many investors took leave owing to the Muslim Eid festivities, traders said.
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