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AAP

2013-01-31

A summary of trading in key commodities markets overseas:

ENERGY

World oil prices rose slightly, off earlier multi-month highs, as official data showed that the US economy contracted in the fourth quarter last year.

Cautious trading set in also as markets awaited the outcome of a Federal Reserve monetary policy meeting and as the United States' government said American crude inventories had shot higher last week, indicating weak demand for oil in the world's biggest consumer of crude.

In late London deals, Brent North Sea crude for March traded at $US114.60 a barrel, up 24 US cents. Earlier Wednesday it had hit $US115.24 a barrel -- the highest point since mid-October.

New York's main contract, light sweet crude for delivery in March, was meanwhile up two cents to $US97.59 a barrel compared with Tuesday's closing level.

PRECIOUS METALS

Gold futures ended at their highest level in a week as weaker US economic data soothed worries that the Federal Reserve would cut short its easy-money policies.

Gold extended those gains in after-market trade on Wednesday, after Fed officials held monetary policy steady after months of reconfiguring their bond-buying and communications policies.

Gold for April delivery, the most active futures contract, rose $US18.90, or 1.1 per cent, to settle at $US1,681.60 a troy ounce on the Comex division of the New York Mercantile Exchange.

The contract touched a high of $US1,685 a troy ounce, the highest traded level since January 24, on the Fed's policy statement, which was released shortly after Comex floor trading closed for the day.

BASE METALS

Base metals closed higher on the London Metal Exchange (LME), shrugging off disappointing US growth data as investors took cues from the currency markets and focused on other, more positive, economic indicators.

At the PM kerb close on Wednesday, LME three-month copper was up 1.5 per cent at $US8,226 a metric ton. Nickel gained the most, rising 2.8 per cent to close at $US18,355/ton.

News that US gross domestic product (GDP) unexpectedly shrank 0.1 per cent in the final quarter of 2012 had little impact on base metal prices Wednesday, which pushed higher after an initial wobble. Economists had expected GDP to grow one per cent in the fourth quarter.

The report's effect was limited largely because the contraction was driven by a 22.2 per cent slump in defence spending, said analysts and traders.