HEDGE fund trading is playing havoc with base metal prices, making it difficult to calculate true values and making prices more susceptible to quick pull-backs.
Prices for many base metals are at, or near, record levels after spectacular rises this year.
But a decrease in prices, mainly by overseas investors taking profits, sent a shiver through the Australian share market this week.
“While recognising that fundamentals for base metals are strong, we remain of the view that current metal prices have been inflated by investment flows,” Goldman Sachs JB Were analysts said yesterday.
