Bloomberg reported that nickel climbed to a 12 week high in London on speculation economic growth in China will boost demand for the metal used mostly in stainless steel.

As per report, nickel for three month delivery on the London Metal Exchange rose USD 658 or 3.4% to USD 20,153 a tonne. Prices reached USD 20,201, the highest level since October 25th 2011, and are above the 100 day moving average.

China's banking regulator is weighing a plan to relax capital requirements for lenders, delaying implementing the most stringent capital adequacy ratios. US economic data also supported prices as Philadelphia area manufacturing expanded at a faster pace this month.

Mr Daniel Brebner, a Deutsche Bank AG analyst, said that the stainless steel market could witness considerable restocking into early spring, with better than expected economic data in the US, some reasonable strength in Japanese operating rates and some stability in Europe.

Mr Brebner said that nickel will outperform gold in the next 12 months on positive global cyclicality. Delays to new nickel projects may support prices.

(Sourced from www.bloomberg.net)