Sep 2 (Bloomberg)—
Copper fell from the highest level in almost five months on speculation that an uneven U.S. economic recovery will damp demand for industrial metals.
The National Association of Home Builders/Wells Fargo confidence index in September held at the lowest level in more than a year, data showed today. The U.S. is the world’s second- biggest copper consumer. Earlier, the metal climbed as the dollar’s slide boosted the appeal of commodities.
"Copper is driven by the economic engine,” said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. "The deterioration in the economic situation leaves copper vulnerable to the downside.”
Copper futures for December dropped 1.75 cents, or 0.5 percent, to settle at $3.5045 a pound at 1:35 p.m. on the Comex in New York. Earlier, the metal reached $3.5555, the highest price since April 26.
Construction accounts for a quarter of all U.S. copper consumption, according to the Copper Development Association. Commercial real-estate prices fell for a second straight month in July as expectations for economic growth slumped, Moody’s Investors Service said today.
Twenty-seven of 58 economists polled by Bloomberg News this month projected growth in 2011 below the 2.5 percent to 2.8 percent pace that Federal Reserve policy makers peg as the long- term trend. Twenty-eight said the jobless rate will top last month’s 9.6 percent sometime in the next nine months. That combination would constitute a growth recession.
Copper has gained 26 percent in the past year as inventories dropped and demand climbed in China, the biggest user.
On the London Metal Exchange, copper for delivery in three months dropped $5, or 0.1 percent, to $7,715 a metric ton ($3.50 a pound).
Nickel, tin and lead also fell on the LME. Aluminum and zinc climbed.