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Improving economic news for US and China but commodities holding back

Date: Thu, 1 Mar 2012 | Author: Paul Sanderson

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Despite good economic data coming out of both the US and China, primary commodity markets were not boosted by the news.

The US Federal Reserve in its Beige Book survey said that the US economy expanded at a “modest to moderate pace” in the past two months.

While the Chinese manufacturing index rose to 51.0 in February from 50.5 in January, according to the Chinese National Bureau of Statistics and the China Federation of Logistics and Purchasing. A figure above 50 shows expansion.

However, with the US also revealing that its crude oil stockpiles rose by 4.2 million barrels last week, and Saudi Arabia also deploying more oil rigs in case of possible shortages caused by tensions with Iran, the oil price fell.

In New York, oil for April delivery was down 25 cents to $106.82 a barrel. While Brent Crude increased to $122.76 a barrel, this was still lower than the $125 level seen earlier in the week.

Copper fell for the first time in four days ending yesterday at $8,499 (£5,379) down from a high of $8,695 (£5,503) in the same day.

Aluminium was up just a touch to $2,327 (£1,472) from $2,325.

 The S&P GSCI index of 24 commodities was up 0.3 per cent.

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