Graphic: the rise and fall of gold

Metals prices tumbled yesterday, leading a broad-based sell-off across commodities markets, as fears of a global economic slowdown and the resurgence in the dollar vexed investors.

Having risen relentlessly for months, prices of key metals went into an abrupt retreat yesterday, fuelling speculation that they could succumb to a sustained decline.

The development made metals the latest in a series of what had been one-way bets in world markets to stage a sudden reversal that could wrong-foot some institutions with large investment exposures.

Among yesterday's losses, prices for copper, aluminium and tin fell to their lowest levels in more than six months, while zinc prices sank to their lowest since November 2005, and lead prices slipped to their lowest for five weeks.

Prices for lead staged some of the biggest falls. The cost of lead for delivery in three months plunged by 9.6 per cent to $1,740 (£916) a tonne, its lowest since July 9.

On Monday prices for lead, which is used mainly in batteries, had closed at a high of $1,925.

Copper was also down sharply on the London Metal Exchange, with three-month prices for the metal registering a drop to $7,128 a tonne from $7,330 on Monday, a fall of 2.75 per cent.

The broad slide in prices across metals markets came as anxieties of badly faltering activity in the eurozone and nervousness that buoyant emerging market economies could also now suffer a slowdown, fuelled worries that weaker global growth would undercut previously booming demand for commodities.

Pressure on prices of metals and other commodities was intensified by the recent potent rally in the dollar on foreign exchanges, which has driven the euro to six-month lows.

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