Copper heads for weekly drop on US demand concern

Copper fell in London and headed for a weekly decline after reports stoked concern that the economic rebound may be weaker than expected in the US, the world’s second-largest consumer of the metal. Manufacturing in the Philadelphia Federal Reserve Bank’s region expanded in June at the slowest pace since August, and initial jobless claims rose in the week ended June 12, data showed on Thursday. US housing starts fell the most since March 2009 and building permits, a sign of future construction, slid to a one-year low, reports showed on June 16.

“The US data was not great,” said Jesper Dannesboe, a strategist at Societe Generale SA in London. Still, “we expect the US recovery to continue, helped by super-lax monetary policy and pent-up demand,” he said. Copper for delivery in three months dropped $81, or 1.3 per cent, to $6,365 a metric tonne at 10:26am on the London Metal Exchange. The contract retreated to the lowest intraday price since June 10 and is down 1.8 per cent this week. Futures for September delivery declined 1.2 per cent to $2.888 a pound on the Comex in New York. LME copper has slid 14 per cent this year on concern about European nations’ ability to reduce budget deficits and steps taken by China, the biggest copper user, to cool its real-estate market.