Commodity Online BEIJING: Will China help resurrect the falling prices of commodities, especially of crude oil and gold? It looks so if a major economic package that Beijing has announced is any indication.
On Sunday, China unveiled a 4 trillion-yuan ($586 billion) economic package which the government said that would spur growth and demand for fuels.
China said the country will spend the money through 2010 on housing and infrastructure, boosting demand for commodities including iron ore, crude oil and copper, which also gained.
Responding positively to the Chinese announcement, crude oil for December delivery gained as much as $3.26, or 5.3 percent, to $64.30 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $63.90 during the morning Monday trading in Singapore.
Similarly, copper for delivery in three months on the London Metal Exchange climbed for the first day in four to $4,040.00 a metric ton, and stood at $4,039.
Gold prices for immediate delivery rose for the second day, gaining 1.7 percent to $749.50 an ounce in Singapore.
Analysts said the Chinese package may help revive the falling commodities prices, especially of crude oil and gold. "Yes, the Chinese economic package is a good announcement in these trying times of weakening global economic activity. It will help commodity prices to grow. It will help rise crude oil and gold prices," Melvin Frank, a London-based commodity analyst said.
