A weak US dollar supported prices as well. The Dollar Index, which measures value of the US dollar against a basket of foreign currencies, slipped more than 12 per cent this year. A strong US currency makes dollar denominated commodities expensive for holders of other currencies. At the same time, the Indian rupee has gained about 7 percent during this period.
Declining inventories in the LME warehouse is the other reason that supported an uptrend. LME stocks of many base metals are currently placed at multi-year low levels.
Looking ahead, further sharp rallies are least expected due to lack of strong fundamentals. Reports indicate that the mine production is recovering from disruptions earlier this year with many of them reporting growth in output, which may increase the supply later.