Aug 01, 2012 (Dow Jones) NEW YORK -- Copper futures fell to the lowest level in one week as gloomy global manufacturing data and caution ahead of a policy statement from the Federal Reserve pushed traders to cash out.

The most-actively traded copper contract, for September delivery, fell 4.25 cents, or 1.2%, to settle at $3.375 a pound on the Comex division of the New York Mercantile Exchange, the lowest ending price since July 25.

China's government gauge of manufacturing activity slipped in July to the weakest point since November, data released Wednesday showed, as Europe's banking crisis and a stalled U.S. economy limited demand for Chinese exports. Manufacturing growth slowed or contracted elsewhere in Asia as well as in the euro zone and in the U.S., separate reports showed.

"On the demand side, it weakens prospects down the road for China's slowing economy," said Dave Meger, director of metals trading with Vision Financial Markets.

Copper is sensitive to such reports because of its widespread uses across industries. The electrically conductive, ductile metal is used chiefly in wiring and plumbing. China accounts for about 40% of world copper demand.

The bleak set of global manufacturing data "spells growing domestic excess capacity in China and weak external demand for manufactured products," said Walter de Wet, an analyst with Standard Bank, in a note. "Backlogs are disappearing, and neither new orders nor export orders are growing."

Trading volume was lower than normal Wednesday, with some traders sticking to the sidelines ahead of the Federal Reserve's latest monetary-policy statement. The central bank's policy-making committee was set to conclude a two-day meeting Wednesday, with a statement expected at 2:15 p.m. EDT.

Slowing U.S. growth has prompted speculation that the Fed may take new steps to boost the economy. Such moves can stoke investors' interest in copper and other growth-sensitive commodities.

Copper futures extended their earlier losses Wednesday after payroll processor Automatic Data Processing Inc.'s better-than-expected reading on U.S. private-sector hiring. The report spurred a touch of skepticism, traders said, that the U.S. economy was in dire enough straits to force Fed action.

Copper settlements (ranges include electronic and pit trading):
Aug $3.3765; down 4.30 cents; Range $3.3650-$3.3910
Sep $3.3750; down 4.25 cents; Range $3.3605-$3.4265